Industrial Goods Sector

DEFINITION of 'Industrial Goods Sector'

A category of stocks that relate to producing goods used in construction and manufacturing. This sector includes companies involved with aerospace and defense, industrial machinery, tools, lumber production, construction, cement and metal fabrication.

BREAKING DOWN 'Industrial Goods Sector'

Performance in the industrial goods sector is largely driven by supply and demand for building construction - residential, commercial and industrial - as well as the demand for manufactured products. When the economy contracts and consumers save more and spend less, activity in this sector drops because companies will postpone expansion and produce fewer goods.

The performance of the industrial goods sector closely follows the performance of the S&P 500.

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RELATED FAQS
  1. How does the risk of investing in the industrial sector compare to the broader market?

    There is increased risk when investing in the industrial sector compared to the broader market due to high debt loads and ... Read Full Answer >>
  2. What option strategies can I use to earn additional income when investing in the ...

    Investors who are bullish on the industrial sector can use a covered call option strategy to earn additional income from ... Read Full Answer >>
  3. What is the average price-to-book ratio in the aerospace sector?

    Aerospace companies under the industrial goods sector scope could provide value-investing opportunities to investors. However, ... Read Full Answer >>
  4. What debt/equity ratio should I look for when investing in industrial companies?

    The average long-term debt/equity (D/E) ratio that you should expect for companies in the industrial goods sector is 146.44, ... Read Full Answer >>
  5. What developed countries have the largest proportion of industrial companies?

    The developed countries with the largest proportion of global industrial companies have remained relatively stable between ... Read Full Answer >>
  6. What dividend yield is typical for companies in the industrial sector?

    The average dividend yield of the industrial goods sector is approximately 1.71%. The industrial goods sector is a group ... Read Full Answer >>
  7. What are some popular ETFs that track the industrial sector?

    As of April 2015, some of the most popular and best performing exchange-traded funds (ETFs) that track the industrial sector ... Read Full Answer >>
  8. Which stocks in the industrial sector pay the highest dividends?

    In the industrial sector, some of the companies that pay the highest dividends include Highway Holdings Limited, OCI Partners ... Read Full Answer >>
  9. What mutual funds can be used for investing in the industrial sector?

    The industrial goods sector provides investors access to companies that engage in activities such as aerospace and defense, ... Read Full Answer >>
  10. How are industrial goods different from consumer goods?

    Industrial goods are made up of machinery, manufacturing plants and materials, and any other good or component used by other ... Read Full Answer >>
  11. What does it mean to invest in base metals?

    Portfolio diversification is a necessity for most investors; it provides a smart way to spread out the risk associated with ... Read Full Answer >>
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