What We Do

Momentum Trends The most simplistic definition of a bull market is when a major stock index such as the Standard & Poor’s 500 (S&P 500) rallies 20% from a prior low. A bear market is a 20% decline from the most recent high. But in the current market environment, the definitions that perhaps carry the greatest weight, and could effect investors’ portfolios the most, involve so-called cyclical and secular market moves.

Simply put, a secular bull or bear market is one that can be measured in decades. They are "once-in-a-generation" events. There have been four secular bulls and four secular bears since 1900. The last secular bull market occured between 1982 - 2000. This environment favored a passive approach. The last secular bear market occured 1966 - 1982. This environment favored an active approach.

In contrast, a cyclical move is a market trend that lasts several months to a couple of years. There have been 33 cyclical bulls and 33 cyclical bears since 1900. This environment favors a more active strategy.

These cycles provide the basis for W. E. Donoghue & Company’s investment portfolios, which we call our "reality based" investment approach. Reality based means that we base our decisions on what the market is doing, not on opinion. We construct proprietary models that track current market cycles and steer us toward the sectors of the market that have the highest probability for success. We look to identify trends.

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