"A Column on TOYOKEIZAI ONLINE is Changing Investment with Cycle Theory"

Good morning, this is Matsushita.

I started investing in stocks in 2001,

and for a year and a half I was a trader who never won at all.

The secret that changed me into a winning investor,

is "cycle theory."

Today, I will introduce the benefits you gain by learning cycle theory,

the unique advantage you can obtain that other investment theories do not offer,

and its particularly clear and advantageous trading characteristics.

1. You can recognize special large opportunities

2. You can imagine and visualize future price movements

3. You can selectively enter trades

There are many more surprising advantages, but

the most straightforward and clearly advantageous for trading are these three points.

First, as the main feature of cycle theory,

you can know when opportunities will come throughout the year,

whether a big opportunity like once every five years or ten years will come

and when it will arrive.

This is the major opportunity—knowing when it will come.

This comes from the fact that there exist measurable cycles from short-term to ultra-long-term within price movements,

which is the most important feature of cycle theory.

In 2002, I began making profits with a trading approach that bought “the big opportunities that come three times a year.”

The ability to know “special large opportunities” is the greatest feature and advantage of cycle theory.

Next is that you can imagine future price movements and

visualize them in your head.

When you learn cycle theory, you will understand how prices will move in the future and where they are now.

Because this is a forecast of future price movements,

it will never be 100% accurate, but

it becomes accurate to a certain degree,

which is highly advantageous for trading.

When the forecast is wrong, you cut losses small, and

when it is correct, you can greatly extend profits.

It means you will be able to predict price movements.

And above all, it makes investing incredibly enjoyable.

“Your forecasted price movements appear before you,

and you can earn profits from movements that unfold as you predicted.”

Ever since I experienced this astonishing sensation 14 years ago,

I have been hooked on cycle theory and cannot let go of it.

And over 14 years, I have predicted various price movements of all sizes.

“Matsushita was right about trades and profits.”

“You pick stocks that rise well.”

These kinds of comments have continued for 14 years,

because cycle theory allows you to foresee future price movements.

This is also possible for long-term price movements spanning a decade,

and there is no other investment theory like this.

“Being able to imagine future price movements, visualize them”

This characteristic translates into enjoyable and profitable outcomes,

the benefit of cycle theory.

And you can selectively enter trades.

In last week's survey of investment performance from last year,

several people cited the reason for losses as “too many unnecessary trades.”

That’s exactly right. Individual investors end up hemorrhaging capital from too many needless trades.

This happens because they cannot narrow down opportunities and are always rushed by price movements.

However, by learning cycle theory,

you can identify large opportunities and wait.

Naturally, entry timing becomes more selective,

and the number of trades decreases.

Most importantly, because you are waiting for opportunities to come,

your mind does not race, and you calmly await the moment when the opportunity arrives.

This makes a big difference both in terms of capital management and emotional stability.

I have introduced just three characteristics and benefits of cycle theory,

but even with just these, the difference between knowing and not knowing cycle theory is huge—the difference between night and day, a world apart.

When you learn cycle theory, investing literally changes completely.

I changed my investing through cycle theory,

and transformed from days of losses to days of profits.

Before that, it was days of despair, but

after learning cycle theory, it became days of hope.

Please try learning cycle theory as well.