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
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    Read about the different types and interpretations of accounting cycles, and why all businesses should modify the generic ... Read Answer >>
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