Cyclical Stock
A stock that rises quickly when economic growth is strong, and falls rapidly when growth is slowing down.
Investopedia Commentary
An example is the automobile market, because as growth slows in the economy consumers have less money to spend on new cars. Non-cyclicals would be industries like health care where there is constant demand.
Related Links
The Ups And Downs Of Investing In Cyclical Stocks
See also: Cyclical Industry, Stock
cyclical stock
When should I invest in cyclical stocks? With the proper crystal ball, you should buy cyclical stocks six months before the earnings in the target group begin to move up, and sell the group six months before the earnings turn down. Note: Most crystal balls are cloudy!Steven Flagg, Senior Vice President |
Investments, UBS PaineWebber, Mount Kisco, NY