What are the cyclical stocks?

Cyclical stocks are basically sensitive to market economy data, which may reflect the trend of market economy in advance. In the A-share market, typical cyclical stocks include: steel stocks, non-ferrous metals stocks, chemical stocks, automobile stocks, real estate stocks, brewing stocks, aviation stocks and so on.

With the development of market economy, the demand for products in these cyclical industries will increase rapidly, and the performance and stock price of these industries will also be effectively and rapidly improved. On the contrary, when the market economy is in recession or depression, the market demand for products in these industries drops rapidly, which leads to the rapid decline of individual stock performance and stock price in this industry.

In the A-share market, the cyclical performance of different industries will be different. For example, when the market economy is in the initial recovery stage, non-ferrous metals, construction, paper making, steel and other basic industries will give priority to other cyclical stocks to reflect the early rise of the market. When the market economy has an obvious growth stage, capital-intensive industries such as general machinery industry, industrial machinery industry, electronics industry and production development industry will show outstanding performance. Then, when the market economy reaches its peak, it will promote high-consumption industries such as automobile industry, wine industry, tourism industry, hotel industry and luxury goods, thus indicating that the market economy is at a high stage.

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What is a cyclical stock?

Cyclical stocks refer to the stocks that listed companies pay higher dividends. With the ups and downs of the market economy cycle, cyclical stocks will affect the ups and downs of stocks. Compared with other stocks on the market, this term stock has a higher face value.

Cyclical stock is the largest stock type, which fluctuates with the fluctuation of economic cycle. When the overall economy rises, the prices of such stocks will also rise rapidly; When the overall economy declines, the prices of these stocks will also fall.