Where does the market stand now? It may depend on your timeframe. That’s because markets tend to move in cycles. But no cycle moves in a straight line. A long-term cycle may be considered secular. But shorter moves may be considered cyclical.

Markets may have moved higher in the past few weeks. But they haven’t broken their downtrend. While this cycle will end in time, over a longer timeframe, markets may head higher.

This would be the secular bull market. Given that stocks generally rise most of the time, long-term bullish investors may have the last laugh.

A secular cycle is a big part of the economy. But a cyclical move may be more short-term. The post-World War II market rally higher was a secular cycle driven by new spending and investments at home. That move lasted for decades.

Right now, we may be in a secular bull market that started in 2013. That’s when markets moved past their pre-Great Recession highs. The current volatile market may simply be a cyclical move driven by the pandemic and its after effects.

If true, such a move should end in time, with the longer-term secular bull market taking over. Investors who can recognize where we are in those two cycles can best profit from getting the big moves right in the year ahead.

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Investors tend to make the biggest mistakes when they get emotional. And let’s face it… it’s easy to get emotional when the market crashes. It may seem like the world is ending. And that the end isn’t in sight.

But market history shows that bear markets and recessions tend to look like speed bumps against a long-term uptrend over time. The market always finds a way up. And investors who ignore the fear tend to come out on top.

Most investors know that markets will be volatile. But that knowledge doesn’t compensate for the stomach-churning sense while a market crash is going on. Looking at big daily drops can make investors wary, even if they know the best strategy is to measure returns in months and years.

For most investors, the simplest strategy is to buy a market index fund, and make regular, consistent contributions to it.

Individual stock picking can be fun. But it can take a considerable amount of time to play out successfully.

Every company has unique characteristics to it, and trying to understand why some companies are wildly successful and others aren’t can be wildly profitable.

Investors should know where to stick with index investing, and when to branch out into individual stock investing based on how they can handle market volatility.

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The recent bear market has wreaked havoc for portfolios of investors large and small. During a market rally, it’s easy to buy just about anything and watch the price rise.

However, that can lead to extreme valuations and lead to big pullbacks when the music stops. Investors who follow a few simple guidelines don’t have to be at the complete mercy of the stock market.

That’s why having some ground rules can make a huge difference in your investing returns.

Sure, it’s easy to see that, in time, stocks usually go up. But when the market has been down recently, it’s a time of fear. Investors should consider the long-term in mind, and use opportunities like a bear market to acquire stocks worth holding for years.

At the other end of the spectrum, it’s normal for the market to have down years. The lesson is that investors should look out for such years as a buying opportunity. And that they shouldn’t get overly bullish or risky when markets have been rising for some time.

And while the economy may look incredibly risky at times, the world hasn’t come to an end yet. If it does, your portfolio will be your last concern. That’s why it still makes sense to be mostly invested, most of the time.

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