The 11 Sectors That Make Up the Stock Market

The stock market can appear to be a very complex and scary thing. However, when one takes the time to break it down, it does not appear to be nearly as intimidating as one might think. One of the pieces of information that can be used to understand trends in the stock market is employee insider trading. With the market being free and open to anyone, it can be useful to look at employee’s stock market activity when looking to invest in a specific company.

There are many different companies that are publicly traded on the stock market. It can be hard to keep track of the performance of many different companies that you may want to include in your portfolio. This is why the stock market is divided into eleven different sectors, and these are those sectors:

Information Technology

The companies that are in this sector of the market include Google, Apple, and Amazon, among many others. Due to how society is currently, technology is king. Due to the high demand for technology and constant upgrades that are being made, this sector is the one that is most likely to boom. In the past two years, the tech companies included in the S&P 500 have seen over 40% returns, which tops all sectors the last two years.

Health Care

Due to the recent pandemic, the health care industry has been under a microscope across the world. In recent history, this sector of the market has been around the middle of the pack in terms of performance. However, with the recent pandemic and vaccines that are being produced all over the world, this sector could see a big increase in performance.


Financials, similar to the health care sector, has performed around the middle of the pack when looking at the top 500 publicly traded companies. However, trading platforms have become incredibly easy to access recently, and you can read about it in this article. This has allowed anyone with some disposable income to invest in the market. Since the financial sector is becoming more popular with the general public, it may see an increase in performance in the near future.

Consumer Discretionary

The companies that are included in the consumer discretionary market are those that sell goods and services that are deemed non-essential. This would include companies such as Nike and Home Depot. With the pandemic nearing its end, this sector might see an increase in returns with more individuals looking for non-essential endeavors.

Communication Services

This sector includes companies such as AT&T, Verizon, and many other mobile communication services. This sector has seen large returns in some years and has seen negative returns in others. This sector is volatile, but it could potentially see some large returns.


This sector includes companies that produce machinery and equipment for construction and manufacturing. This sector, similar to communication services, has seen years of big returns and other years that resulted in negative returns.

Consumer Staples

This sector includes companies such as Target, Costco, and Walmart. This sector is pretty consistent because consumers will always need these companies for everyday needs such as groceries. This sector will not be the highest gainer, but it will also not see crazy negative returns.


This sector deals with petroleum stocks, and gas is needed for many different vehicles that are required for transportation. This sector is risky, and looking at the companies in the S&P 500 this sector has struggled in recent years.


The utility sector does not create large returns. It very rarely has negative annual returns, but compared to the other sectors it is not a big sector that has the potential for a boom.

Real Estate

The real estate sector is similar to the utility sector. It is rare to see negative annual returns in recent memory, but it will not be a sector that has boom potential.


In recent years, the annual returns have been the middle of the pack for annual returns. Similar to the real estate and utility sectors, it will not have a big potential for a boom.

Currently, the market seems to be very bullish, but it is important that everyone is informed prior to investing in the market. This article by the New York Times details this and can be read here.

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