Basic Materials Sector

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DEFINITION of 'Basic Materials Sector'

A category of stocks that accounts for companies involved with the discovery, development and processing of raw materials. The basic materials sector includes the mining and refining of metals, chemical producers and forestry products.

INVESTOPEDIA EXPLAINS 'Basic Materials Sector'

The basic materials sector is sensitive to changes in the business cycle. Because the sector supplies materials for construction, it depends on a strong economy. This sector is also sensitive to supply and demand fluctuations because the price of raw materials, such as gold or other metals, is largely demand driven.

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RELATED FAQS
  1. What methods can an investor use to get leveraged exposure to the chemicals sector?

    The best methods to gain leveraged exposure to the chemicals sector are to buy the ProShares Ultra Basic Materials ETF (UYM) ... Read Full Answer >>
  2. What are the major types of insurance policies that insurance companies will offer?

    The principal commodities used in producing chemicals are oil, natural gas, coal and a wide variety of metals and minerals. ... Read Full Answer >>
  3. What is the average annual dividend yield of companies in the electronics sector?

    The chemicals industry is part of the basic materials sector which, as of 2015, is the highest dividend-paying sector on ... Read Full Answer >>
  4. What are the primary reasons for investing in the chemicals sector?

    There are many reasons for investing in the chemicals sector, including portfolio growth, diversification, and hedging against ... Read Full Answer >>
  5. Which commodities are the main input materials for the automotive sector?

    The automotive sector uses a wide range of materials in manufacturing. Metals such as aluminum and steel, advanced plastics ... Read Full Answer >>
  6. What is the forest products sector?

    The forest products sector is comprised of companies involved in growing, harvesting and/or processing wood and wood fiber, ... Read Full Answer >>
  7. What are the most popular mutual funds that give exposure to the forest products ...

    Under the purview of the basic materials sector, investors have the opportunity to gain exposure to companies engaged in ... Read Full Answer >>
  8. What is the average annual dividend yield of companies in the forest products sector?

    For investors seeking income through dividend investing, companies within the forestry sector provide an attractive opportunity ... Read Full Answer >>
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