Business Cycle and Sector Rotation

Some business sectors perform better during certain stages of an economic cycle and some during others. To take advantage of these regularly occurring business and economic fluctuations, we need to know when a sector typically outperforms and when it underperforms. The Business Cycle model tells us when an industrial sector has a greater probability of outperforming the market. The sector rotation approach guides us in taking money out of underperforming sectors and putting it into outperforming sectors.