Leaders and Laggards Definition Monday, October 6, 1:38 PM ET
On any given trading day, an entire industry or sector might be moving notably higher or lower as a group. Perhaps the price of oil is moving, causing traders to re-value energy companies. Perhaps interest rates are in focus, causing traders to re-value financials.
Knowing which sectors are rallying and which are falling, can help investors sift through possible buying and selling opportunities. Certain sectors, like retail and housing, are also widely watched as a gauge of the overall health of the economy. Contrarians will often seek out sectors that are out of favor, looking for value and an eventual rebound in sentiment.
Leading versus lagging sectors may also behave differently in different market conditions, for example a sector that has seen strong gains might be more vulnerable to profit-taking behavior, while a sector that has underperformed could be more likely to see tax-loss selling into the end of the year.
Keep following Market News Video for daily updates on sector leaders and laggards.
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