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Sectors, Industries, and the Business Cycle — Financials
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The Financial sector contains companies involved in financial activities. This includes banking, mortgage finance, consumer finance, specialized finance, investment banking and brokerage, asset management and custody, corporate lending, insurance, financial investment, as well as companies engaged in real estate investment, management & development. In general, the majority of the revenue generated by the sector comes from mortgages and loans that gain value as interest rates rise.

The industries under this sector are:

  • Banks
  • Capital Markets
  • Consumer Finance
  • Diversified Financial Services
  • Insurance
  • Mortgage REITs
  • Thrifts & Mortgage Finance

The Financials sector is sensitive to the business cycle. When times are good companies are known to take out more loans to use for their business expansion.