“It’s easy to stand in the crowd but it takes courage to stand alone”
― Mahatma Gandhi
Cyclically-driven investing is among the most challenging endeavors in finance. The main problem that most encounter is being contrarian. Standing against consensus trades and opinions is very tricky in practice. Moreover, a systematic approach to cyclically-driven investing is not about rigorous diversification. Instead, a planned risk concentration gets monitored very closely. Last but not least, taking risks also involves declining returns over extended periods until things sort out.
Not surprisingly, very few professional market participants can navigate asset cycles systematically. Nevertheless, those who were able to take on the challenge patiently have benefited generously.