There are innumerable things to learn while trading in the stock market. One of the foremost among them is Stock Sectors.
Millions of stocks trade in the stock market every day. Some stocks may have certain similarities with others – one of which are stock sectors.
This article is solely dedicated to discussing stock sectors and various aspects related to them.
What are stock sectors?
Let us start at the basic level. Stock sectors refer to the industry in which a company operates, for example, banking, IT, pharma and others. Often a group of companies belong to the same stock sector, such as State Bank of India, ICICI Bank, HDFC Bank belong to the banking sector.
How many stock sectors are there?
Globally, share market sectors are most commonly classified by a standard classification system – the Global Industry Classification Standard (GICS).
As per this classification, there are 11 stock sectors as shown below:
While this is the broad classification, each sector is further broken into multiple sub-sectors as per companys’ exact line of business.
Why are stock sectors important?
You must be thinking about how this knowledge about stock sectors applies to your trading life?
Good question!
The knowledge of stock sectors can have a direct impact on your portfolio. A sectoral breakdown of your portfolio can provide you with insightful insights. You can learn about the sectors included in your portfolio and sectors which have been left out.
Moreover, heavy independence in any one sector is never recommended. Hence, the knowledge of stock sectors can help you to diversify your portfolio. You may also want to target a specific sector when significant news breaks out about it or the future predictions of that sector is good.
For example, electric vehicles (EVs) have been deemed as the future of the automobile industry. Hence, you may want to invest in the EV stock sector to gain from their increasing market share.
Not only stock trading, knowing the stock sectors can have a great influence on mutual fund investing as well. Several sector-specific stocks are available in the market. You may choose to invest in any of them to increase your exposure in that sector.
The knowledge of stock sectors can help you stay clear of some stocks if you choose to. For example, if you are an ethical investor, you may choose not to invest in stocks that sell tobacco or alcohol.
Stock sectors are a primary consideration while analyzing your portfolio and rebalancing it. While portfolio analysis takes into account your investment in various instruments, it also keeps a keen eye on the sectoral distribution. Rebalancing applies to sectoral reallocation as well.
How to track corporate sectors?
A very common question may arise while speaking of portfolio analysis and rebalancing – how to keep track of stock sectors to carry out this operation?
Not to worry!
Today, several apps and websites are available which can provide you with the latest information regarding various stock sectors. But be careful. Many of them may not be reliable or may not provide you with updated news.
StockEdge is one of the best stock tracking apps which provides end-to-end data about all the corporate sector companies. Not only stock market sectors, but StockEdge is also one of the premium stock trading apps in India providing a 360° outlook on the stock market and mutual funds.
StockEdge provides a detailed stock overview across 41 stock sub-sectors, as provided below:
| Stock Sectors Available On The Stock Edge App | ||||
| Abrasive | Agriculture | Alcohol | Automobile & Ancillaries | Aviation |
| Banking | Capital Goods | Chemicals | Construction materials | Consumer durables |
| Crude oil | Diamond jewellery | Diversified | Electricals | Ferromanganese |
| Finance | Fast-moving consumer goods | Gas transmission | Healthcare | Hospitality |
| Industrial gases and fuels | Infrastructure | Iron & steel | Information technology | Logistics |
| Media & entertainment | Mining | Miscelleneous | Non-ferrous metals | Other |
| Paper | Photographic product | Plastic products | Power | Ratings |
| Realty | Retailing | Ship building | Telecom | Textile |
| Trading |
Extensive information is available for each sector, to help you gain the right kind of information at the right time. You can see stock gainers and losers at the end of each trading day, you can access the latest news and events associated with each sub-sector and do much more. This can help you to remain on top of things at all times – one of the main reasons why StockEdge is considered to be the best stock tracking app in India.
Let us take one of the major corporate sectors as an example – fast-moving consumer goods (FMCG).
FMCG is one of the most diversified corporate sectors in India. On StockEdge, information is available on the entire FMCG sector as a whole, as well as subsector-wise, which are given below:
- Household & personal products
- Leather
- Packaging
- Detergents & soaps
- Consumer food
- Cigarettes & tobacco
This will not only help users to access a specific stock in a specific sub-category, but will also help them to understand the sectoral allotment in their portfolio.
For each category, the app shows a host of specific information related to a stock, which are:
- MCAP
- Debt
- EV
- Sales
- PAT
- P/E
- D/E
- ROE
- ROCE
The app also shows stock gainers and losers, news and events of the corporate sector companies belonging to this segment.
When it comes to tracking stock sectors, the StockEdge app is unparallel. No other app shows such a wide array of information, arranged so beautifully.
Check it out today and see how it can help you.
