Recessionary period：
• Increase investment in defensive companies (utilities, tobacco& liquor, household non-durable items); decrease investment in cyclical companies (automobile, technology, manufacturers).
• Increase investment in investment-grade and government fixed income, as interest rate will decline; decrease investment in lower-quality fixed income.
• Increase investment in longer duration fixed income to benefit more from interest rate decline.
• Decrease investment in commodities and companies that produce commodities, in anticipation of lower commodity demand and lower commodity prices

Extractionary/ Inflationary period:
• Increase investment in cyclical companies, which should see a large increase in earnings, and decrease investment in defensive companies.
• Increase investments related to commodities, which should benefit from higher output in the economy.
• Decrease exposure to fixed income securities in anticipation of higher interest rates, but increase exposure to lower-quality fixed income securities in anticipation of lower default risk in an expanding economy.

Stagflation period:
• Decrease investment in fixed income securities in anticipation of higher inflation and nominal interest rates.
• Decrease investment in equities as revenue and profit margins will decrease.
• Increase investment related to commodities in anticipation of higher commodity prices.