VOL. XCIV, NO. 247
BOOK BREAKDOWN
NO ADVICE
Intermediate · 2003
The Right Stock at the Right Time: Prospering in the Coming Good Years
by Larry R. Williams · Partly Dated
A market-timing + stock-selection playbook built around recurring cycles (10-year, 4-year), seasonal turning points (October), sentiment, and money management to profit from rallies even during ugly markets.
Level
Intermediate
Strategies
5 types
Frameworks
6 frameworks
Rating
Target Audience
Ideal Reader
- Investors who want a rules-ish approach to when to be aggressive vs defensive
- People interested in market cycles/seasonality and contrarian timing
- Investors who like combining timing + fundamentals (profitability/growth) + risk control
- Anyone who needs a money-management chapter to keep them from blowing up
May Not Suit
- Set-and-forget index investors who don't want timing overlays
- Investors who want deep valuation work (DCF and accounting deep dives) instead of timing
- People who get tempted by bold forecasts and might follow them mechanically
Investor Fit
| Strategy | Macro/Global · Quantitative · Behavioral Finance · Portfolio Management · Trading |
| Time Horizon | Medium-term (1–5 years) · Long-term (5+ years) |
| Asset Focus | Equities · Macro/FX |
| Math Level | Basic Arithmetic |
| Prerequisites | Comfort reading market charts at a high level (trend, drawdowns, inflection points) · Basic understanding of cycles/seasonality as probabilities (not guarantees) · Willingness to follow risk limits and position sizing |
Key Learnings
- 1Even in bad markets, there are tradable/investable rallies and timing matters
- 2Large recurring cycles can provide a time zone for when big opportunities are more likely
- 3The book emphasizes decennial (10-year) and 4-year patterns, plus a seasonal October effect
- 4Market bottoms can be approached with confirmation logic instead of pure hope
- 5Sentiment can be measured even at the individual-stock level and used as a timing input
- 6Fundamentals still matter: profitability and growth prospects eventually win over stories
- 7Money management is non-negotiable; the best idea can still wipe you out if sized wrong
- 8Be skeptical of overfit: ideas often fail out-of-sample, so treat patterns as probabilistic
Frameworks (6)
Formulas (3)
Case Studies (3)
1962 stock market crash
Takeaway
Periods of fear can be major buying opportunities; the hard part is acting when headlines are scary.
1972 rally followed by 1973-1974 decline
Takeaway
A rally doesn't mean the pain is over; avoid assuming one cycle repeats perfectly.
1999 Nasdaq peak / tech collapse
Takeaway
Story-driven bull markets can break hard when fundamentals can't support valuations.
Notable Quotes
“Years ending in twos and threes are most likely to turn out to be gargantuan buying points.”
“Seldom does the idea work on the out-of-sample information.”
Mental Models
- —Time zones, not precise dates: cycles shift odds, they do not predict perfectly
- —Stacking signals: cycle + seasonality + sentiment + fundamentals beats any single indicator
- —Contrarian posture: fear-heavy periods can be opportunity windows if risk is managed
- —Out-of-sample humility: if a pattern only works in the sample, it is probably junk
- —Survival first: position sizing and drawdown control beat best-stock fantasies
Key Terms
- Decennial pattern
- A 10-year stock-market pattern concept based on the year position within a decade.
- Four-year phenomenon
- A recurring 4-year market cycle concept (often discussed in political/economic cycle contexts).
- October effect
- A seasonal tendency where October is treated as a major turning-point month in some market studies.
- Out-of-sample
- Testing an idea on data outside the original period used to develop it as a check against overfitting.
Limitations & Caveats
Keep in mind
- •Cycle/seasonality work is vulnerable to data mining and structural regime change
- •The book's best-buy-points framing can push readers into overconfidence
- •If implemented mechanically, timing can underperform simple buy-and-hold after taxes/costs
- •Some examples and forecasts are era-specific (early-2000s context)
Reading Guide
Priority Reading
- The 10-Year Pattern in the United States Stock Market
- The Four-Year Phenomenon
- The Amazing October Effect
- How to Know for Sure the Bottom Is Here
- Money Management: The Keys to the Kingdom
Optional Sections
- —Motivational or forecasting-heavy passages if you only want the process
Ratings
Concept Tags
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