Stock Cycle

DEFINITION of 'Stock Cycle'

The evolution of a stock's price from an early uptrend to a price high and eventually to a downtrend. The stock cycle is a buy-and-sell cycle that occurs over several years and has four stages:

1. Accumulation
2. Markup
3. Distribution
4. Markdown

BREAKING DOWN 'Stock Cycle'

The stock cycle has expansion and contraction periods, much like the economic cycle. It can be used for portfolio management allocation, allowing for more investment during the accumulation and markup phases and less investment during the distribution and markdown phases.

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RELATED FAQS
  1. Which accounting cycle is best for my business?

    Read about the different types and interpretations of accounting cycles, and why all businesses should modify the generic ... Read Answer >>
  2. What is revenue cycle management?

    Learn more about revenue cycle management and why the healthcare industry in particular has adopted this payment process ... Read Answer >>
  3. Why is an accounting cycle necessary?

    Find out why it is important for a company to identify and follow an accounting cycle, and how proper accounting helps the ... Read Answer >>
  4. What's the difference between profit margin and markup?

    Learn to differentiate between profit margin and markup, two accounting terms that are often used interchangeably but actually ... Read Answer >>
  5. A person purchases stock XYZ (an Over The Counter stock) from a company who is also ...

    The correct answer is c When the firm is a market maker in the stock then it must act as a principle. Principal is the main ... Read Answer >>
  6. What is the difference between markup and gross margin?

    Read more about the key differences between a company's gross margin and its pricing markup, two rough indicators of business ... Read Answer >>
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