Discover the power of sector investing
Sector investing may help manage risk during market downturns by diversifying your asset allocation and offering another way to strengthen your portfolio.
What is sector investing?
Sector investing is the practice of investing in one or more sectors of the economy. There are 11 main sectors across equity markets: Energy, financials, health care, information technology, consumer discretionary, consumer staples, materials, communication services, industrials, utilities and real estate.
Who is sector investing for?
Sector investing can be appropriate for strategic, long-term investors as well as investors looking to manage a portfolio tactically. Strategic investors can use sector investing to position for potential long-term trends in certain sectors. Tactical investors can invest in sectors over shorter time spans to potentially enhance returns or manage risk at different stages throughout a market cycle.
Why consider sector investing?
Sector investing can help you enhance diversification or invest opportunistically. By investing in multiple sectors across the equity market, you can help protect against the risk of any one sector having an outsized impact on your portfolio. Diversifying across sectors can also help mitigate risk throughout a market cycle. On the other hand, you may choose to invest in specific sectors outside your diversified portfolio to potentially enhance returns or increase broader market participation.
Why invest with J.P. Morgan
- With the combined power of J.P. Morgan and Chase, you get the best of banking, investing and borrowing with instant money transfers and more—all in the Chase Mobile® app or at chase.com.
- Take control of your financial future with J.P. Morgan's interactive tools and intuitive dashboards, allowing you to explore, compare and confidently track your goals with ease.
- Financial planning at J.P. Morgan integrates your life and your money with precision and purpose to make sure your financial momentum never stops.
Here’s how we can work together
WORK ONE-ON-ONE WITH AN ADVISORJ.P. Morgan Private Client Advisor
Work one-on-one with a dedicated advisor in your local community to create a personalized financial strategy and build a custom investment portfolio.
INVEST ON YOUR OWNJ.P. Morgan Self-Directed Investing
Build your investment portfolio on your own with unlimited $0 commission online trades.
Frequently asked questions about sector investing
Sector investing is the practice of investing in one or more sectors of the economy. There are 11 main sectors across equity markets: Energy, financials, health care, information technology, consumer discretionary, consumer staples, materials, communication services, industrials, utilities and real estate.
Sector funds are exchange-traded funds (ETFs) or mutual funds that are focused on a particular sector. As with any investment, sector funds can be risky, especially for more typically cyclical sectors such as energy or financials.
There are 11 market sectors, as generally defined. They are energy, financials, health care, information technology, consumer discretionary, consumer staples, materials, communication services, industrials, utilities and real estate.
While businesses within a sector typically share characteristics, they may also be quite different from one another. For example, the materials sector contains chemical companies as well as mining and paper product firms. The health care sector includes manufacturers of medical devices in addition to service providers such as telehealth firms.
Thematic investing is typically a longer-term investment strategy that relies on expectations related to market trends or “themes.” These themes often cut across sectors.
Thematic investing differs from sector investing in that it is broader in its approach. It groups stocks according to common features regardless of sector. Thematic investing is also seen as a potential way of aligning portfolios while capitalizing on long-run trends.
A sector rotation strategy involves moving investments from one sector to another in response to changing market conditions. For example, the consumer discretionary sector is generally considered a positive investment in periods of economic growth. In contrast, the consumer staples sector, which includes essentials such as food, typically holds steady even when the economy is tightening.
Featured reads on sector investing
Investing in 2026: J.P. Morgan Wealth Management’s top themes to watch
