The stock market is commonly divided into 11 sectors: energy, materials, industrials, consumer discretionary, consumer staples, health care, financials, technology, communication services, utilities and real estate.
Which sectors do well at which times? Sector rotation is an investment strategy that tries to find out — and profit from that information.
Sector rotation is an active investing strategy that involves moving money between sectors in an effort to keep it in the best-performing sectors at all times. It often uses exchange-traded funds (ETFs) that track specific sectors — such as tech ETFs or energy ETFs.
Sector-rotating investors often divide the business cycle — the neverending sequence of economic booms and busts — into…
