You’ve probably heard of stock market sectors, but do you know what they are? Stock sectors are split into categories that consist of companies that operate in different areas of business. There are 11 stock market sectors that make up the entire stock market, according to the Global Industry Classification Standard.
The performance of these sectors varies depending on the nature of the economy. This is why it can be beneficial to have investment exposure to each sector at one point or another while you invest: so you can be covered no matter what.
While one sector may be performing poorly as a result of bad economic conditions, others may be thriving. That’s why it’s important to know each stock market sector and the factors that influence their performance, so you know how to position your investment portfolio as the cyclical market evolves.
The post Stock Market Sectors 101: A Guide to All 11 Sectors originally appeared at U.S. News & World Report.