What is a Sector? – Investing Basics | Fidelity

What’s a sector? Find out how stock sectors are just like shopping malls. Find more articles about investing and personal finance at https://fidelity.com/mymoney To see more videos from Fidelity Investments, subscribe to: https://www.youtube.com/fidelityinvestments Facebook: https://www.facebook.com/fidelityinvestments Twitter: https://www.twitter.com/fidelity Google+: https://plus.google.com/+fidelity LinkedIn: https://www.linkedin.com/company/fidelity-investments _________________________________________________ How else can mutual funds be organized? For one, by something called “sectors.” What’s a sector? Well, it’s a way of organizing companies. Imagine you’re at the local mall and you’re trying to find the food court. So, you look at the mall directory. You see that there are dozens of stores. So, to make it easier for you to find the store you’re looking for, the mall has divided them into categories. For example, you’ll probably see categories for women’s clothing, electronics, gifts, sporting goods, and restaurants. You can think of the stock market as a giant shopping mall. Each mutual fund is a store, and those stores - the mutual funds - fall into certain categories. Another word for these is “sectors.” In the stock market, the categories are things like health care, technology, and precious metals. Some mutual funds invest only in companies in certain sectors. They’re called “sector funds.” So in your stock market shopping mall, you can buy into a health care fund, a technology fund, or a transportation fund. And maybe still have some cash left over to hit the food court. Fidelity Brokerage Services LLC, Member NYSE, SIPC, 900 Salem Street, Smithfield, RI 02917 691158.3.0

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