Consumer Cyclicals

What is 'Consumer Cyclicals'

Consumer cyclicals is a category of stocks that rely heavily on the business cycle and economic conditions. Consumer cyclicals include industries such as automotive, housing, entertainment and retail. The category can be further divided into durable and non-durable sections. Durable cyclicals include physical goods such as hardware or vehicles, while non-durables represent items like movies or hotel services.

BREAKING DOWN 'Consumer Cyclicals'

The performance of consumer cyclicals is highly related to the state of the economy. They represent goods and services that are not considered necessities, but luxurious purchases. During contractions or recessions, people have less disposable income to spend on consumer cyclicals. When the economy is expanding or booming, the sales of these goods rise as retail and leisure spending increase.

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RELATED FAQS
  1. What are the benefits of investing in a cyclical stock?

    Understand the benefits of investing in a cyclical stock. Learn how an investor can use those benefits to potentially reduce ... Read Answer >>
  2. How does an economic downturn affect a cyclical stock?

    Discover the effects of an economic downturn on cyclical stocks. These stocks are highly leveraged to the business cycle ... Read Answer >>
  3. What is the difference between cyclical and non-cyclical stocks?

    Understand the difference between cyclical stocks and non-cyclical stocks. Learn about the underlying demand factors of each ... Read Answer >>
  4. How can I use interest rates to indicate the right time to buy a cyclical stock?

    Determine the best way to use interest rates to figure out the best time to buy a cyclical stock. Cyclical stocks are tied ... Read Answer >>
  5. Should I buy and hold a cyclical stock for long-term gains?

    Discover whether cyclical stocks are a good option for long-term investors. Cyclical stocks tend to be highly leveraged to ... Read Answer >>
  6. How are industrial goods different from consumer goods?

    Understand the difference between industrial goods and consumer goods, and learn the different types of industrial goods ... Read Answer >>
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