As an investing newbie, understanding the different stock market sectors is vital. There are 11 sectors in total, but 5 are the most common.
If you want to start investing in the stock market, now is the right time. But, if you’re new to market investment, how do you know which stock market sectors in which to invest?
Here, you learn about the most common and profitable places to make your money work for you. This article provides the 5 most profitable stock market sectors for the second half of 2018 and 2019. Read on to learn more!
Most Profitable Stock Market Sectors
The international market is the arena of the worlds most profitable stocks. The New York stock exchange and the London exchange split the most common stocks. With the recent activity in the market, the following are the best stock market sectors to invest in 2018 and 2019:
1. Financial Sector
The financial sector of the stock market encompasses firms and institutions that offer financial services to commercial customers and private individuals. These include investment funds, insurance, certain real estate stocks, and banks. The financial sector becomes volatile when mortgage rates go up, but it thrives when interest rates are low.
The financial sector is, historically, a stable sector for market investment. But, no one has forgotten the turmoil of the Great Recession. What used to be subprime mortgages are now called “non-prime” loans, so caution is still advised when investing in the financial sector.
2. Technology Sector
The technology sector shows the most promise for the fourth quarter of 2018 and into 2019. Stocks in this sector are connected to technology-based research and development. It includes software, electronic manufacturing, semiconductors, computational devices, and other information technology products.
The software industry is a particularly strong part of the technology sector in 2019. Adobe Systems Inc., (ADBE) is doing well, and will likely continue to rise. Unexpectedly, GrubHub Inc., (GRUB) continues its annual rise in value, and now is a good time to buy.
The best stock to keep your eye on for 2019 is Intuit Inc. (INTU). In 24 hours the stock went up over 2% in a continual rise.
3. Agribusiness Sector
The agribusiness sector accounts for companies which engage in farming and activities in the commercial agriculture market. This includes the cultivation, production, packaging, and distribution of commercial food products and livestock feed.
Businesses are spreading agricultural production to new countries where profits are maximized for international exports. Agrium Inc., (AGU) is the highest performer over the past three quarters, with a 9% rise in the value of the stock. We recommend that you check out the top agriculture stocks for 2019.
4. Energy Sector
The energy sector is on the rise, as renewables and coal are becoming more competitive. The energy sector includes any company which facilitates the exploration, extraction, development, or distribution of gas, coal, renewables, electricity, and any other energy source.
Toyota Motors (TM) plans to release the Toyota Mirai to the market this year. The Mirai is the first commercial vehicle to use hydrogen for a fuel source. Hydrogen fuel manufacturers are the up-and-coming gold mine of the energy sector.
5. Housing Sector
When the financial sectors interest rates are low, more people build and buy real estate. The housing sector includes the companies that develop, construct, and sell real estate. As you can tell, the success of this sector is directly related to the financial sector.
The value of the housing sector responds to the price of homes, homeowners demand the value of the rental market and regulatory contingencies.
Overall, technology and agribusiness are on the rise. And, if you enjoyed reading this article on the most profitable stock market sectors, read more on upcoming trends from the blog.
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