DEFINITION of 'Sector'

1. An area of the economy in which businesses share the same or a related product or service. Economies are comprised of four sectors. The primary sector involves the extraction and harvesting of natural products from the earth (e.g., agriculture, mining and forestry). The secondary sector consists of processing, manufacturing and construction. The tertiary sector provides services, such as retail sales, entertainment and financial services. The quaternary sector is made up of intellectual pursuits, like education.

2. An industry or market sharing common characteristics. Investors use sectors to place stocks and other investments into categories like technology, health care, energy, utilities and telecommunications. Each sector has unique characteristics and a different risk profile.


1. Dividing an economy into different like-pieces allows for more in-depth analysis of the economy as a whole. Any economy can be divided into sectors, such as the economy of a particular city, or the global economy. The oil and gas sector is an example of an economic sector.

2. It is common for analysts to specialize in certain sectors. For example, at a large research firm, an analyst may cover only pharmaceutical companies. Investment funds often specialize in a particular economic sector, a practice known as sector investing.

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  1. What is the average annual dividend yield of companies in the automotive sector?

    As of May 2015, using trailing 12-month data, the annual dividend yields of industries in the automotive sector are 1.01% ... Read Full Answer >>
  2. What is the average debt/equity ratio of airline companies?

    As of May 2015, based on trailing 12-month data, the average long-term debt/equity ratio of airline companies is 91.53. Airline ... Read Full Answer >>
  3. What is the average price-to-book ratio for companies in the automotive sector?

    The automotive sector provides its investors with value-investing opportunities. It includes auto dealerships, auto parts ... Read Full Answer >>
  4. What is the average annual dividend yield of companies in the wholesale sector?

    The wholesale sector includes auto parts, basic materials, building materials, computers, drugs, electronics, food, industrial ... Read Full Answer >>
  5. What is the average debt/equity ratio for the food and beverage sector?

    The food and beverage sector provides its investors with a variety of investing opportunities ranging from major soft drink ... Read Full Answer >>
  6. What level of return on equity is average for a company in the drugs sector?

    The drugs sector provides a variety of investing opportunities ranging from major drug manufacturing companies to generic ... Read Full Answer >>
  7. What countries represent the largest portion of the global Internet sector?

    As of December 2013, Internet users in 20 countries made up 74% of the global Internet sector, according to Internet World ... Read Full Answer >>
  8. How much does China's growth affect the price of industrial metals?

    Chinese buyers demand more industrial metals than the rest of the world combined. When China experiences strong growth and ... Read Full Answer >>
  9. What is the internet sector?

    According to the Department of Homeland Security (DHS), the Internet sector is a collaboration between the information technology ... Read Full Answer >>
  10. At what levels are core competencies required for businesses operating in the primary ...

    Core competencies help businesses understand their best abilities to perform in the market. Primary sector businesses mine ... Read Full Answer >>
  11. What is the difference between an industry and a sector?

    The terms industry and sector are often used interchangeably to describe a group of companies that operate in the same segment ... Read Full Answer >>

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