Unit 5 · Level 3 · Stocks Deep-Dive
Sectors & rotation
Stocks cluster into SECTORS: technology, financials, energy, healthcare, utilities, and more. Money flows BETWEEN sectors as conditions change: rate cuts favor growth/tech, inflation favors energy, fear favors utilities and staples. This flow is called sector rotation, the stock market's version of crypto's narrative rotation.
Free to play. No ads, no token, no account needed to start.
What you get asked
Match the environment to the classically favored sectors
Classic playbook, not prophecy. But knowing WHERE money typically hides in each weather makes headlines readable.
Why do 'defensive' sectors (utilities, staples) fall LESS in downturns?
Earnings stay boring and stable. Earnings stability = price stability, relatively. Nobody cancels electricity in a recession; plenty cancel a second streaming service and a new car.
The index is flat today, but energy is +3% while tech is −2%. What are you watching?
Flat indexes hide violent internal weather. Sector-watching reveals the flows the headline number smooths away, often BEFORE the index itself turns.
A stock's move is partly its own story and partly its ___'s tide. Always check both.
The best company in a hated sector swims upstream. Before crediting your stock pick, ask how much was just the neighborhood pumping.
How would a trader play a rotation view WITHOUT picking individual winners?
Sector ETFs turn a macro view into one liquid, stoppable instrument, and your whole League 2 toolkit applies unchanged. 🐜
The rest of this unit
ETFs, sectors, dividends and earnings season, plus the League 3 graduation.