To the most profitable stocks Russian companies 2019 included securities of those enterprises and organizations that promise an increase in dividend payments this year. Also, when compiling the list, growth criteria were taken into account net profit and enterprise revenue. A stable financial position also plays an important role when choosing securities for investment. Companies and organizations included in the top ten most promising current year, in addition, have great interest from professional stock market participants.

10.

PJSC shares "Sberbank of Russia" have good potential today. Today, Sberbank of Russia is largest bank not only Russia, but the CIS countries. The main shareholder is " Central Bank RF", which owns more than 50% of the shares. About 40% of the shares are owned by foreign representatives. Sberbank of Russia is well suited for long-term investment, as it brings stable profitable dividends from year to year.

9.

The stock is considered one of the most promising as of 2019. The Russian-language search engine is developing new projects that have great potential in the near future. According to analysts' forecasts, in the near future, Yandex's earnings per share will grow by more than 100% in the next three years, and revenue will approximately double (at the end of 2016 it amounted to 68 billion rubles).

8.

One of the largest and most promising holdings in Russia, created in 2011. According to analysts, the company's shares will become one of the most profitable in 2019. The company acts as an organizer of trading in shares, bonds, currencies, precious metals etc. The holding also owns the NPO JSC National Settlement Depository and the bank National Clearing Center. The largest shareholder of the exchange is the Bank of Russia, which accounts for more than 11%. Second largest shareholder is Sberbank, which owns 10% of the shares, and the third is Vnesheconombank with a stake of 8%. About 62% of the stock exchange shares are in free circulation.

7.

It is considered one of the most promising gas companies, whose shares promise good dividends in 2019. Approximately 70% of gas is supplied to the Russian market by Gazprom. From year to year, the company's revenue is rapidly growing. Shares are primarily interesting for long-term investment. The stock price is expected to rise significantly in the future. Today, the annual dividend yield is in the range of 5-6%. These are not very high figures, but they are expected to increase in the near future. Gazprom securities are traded on exchanges such as London and Moscow.

6.

The stock is projected to be the top performer in the Mobile Telesystems space for 2019. MTS is considered one of the most stable dividend companies. The Russian telecommunications company is investing heavily to buy up Russian cellular companies and CIS countries. Controlling stake shares belong to the holding company AFK Sistema (53%), and the rest is in free circulation at the London, New York, Moscow and other stock exchanges. The revenue and profitability of MTS is growing more and more from year to year.

5.

PJSC "Russian Grids"- one of the most promising enterprises operating in the electric power industry. The opinion why experts advise investing in this company is based on relatively small debts and rapidly growing revenues from year to year. Rosseti owns shares in forty-seven subsidiaries. However, the dividend yield is quite low: at the end of 2018 it amounted to only 0.7%.

4.

Stock PJSC MMC Norilsk Nickel in 2019 will take leading positions in terms of profitability. The Russian mining and metallurgical company is a world leader in the production of precious and non-ferrous metals. Norilsk Nickel ranks first in the world in terms of palladium and nickel production. About 5% of exports come from the mining and metals industry. The share of this enterprise in Russia's GDP is two percent. Over the past couple of years, the dividend yield to shareholders has been about fourteen percent per annum.

3.

It is assumed that the shares OJSC MMK will become one of the most profitable in 2017. This enterprise is the largest and leading steel producer in Russia. MMK accounts for about twenty percent of all metal products manufactured in the country. In 2018, the company's profit increased by more than two and a half times (the increase amounted to more than $1 billion). The company pays stable and good dividends, which become higher every year. Foreign assets and alternative activities provide MMK with a stable position.

2.

PJSC Phosagro included in the list of the most profitable stocks of 2019. The Phosagro holding, founded in 2001, is a leader in the production of mineral fertilizers. The company shows good growth rates and receives increasing profits from its activities every year. So, last year Phosagro’s revenues amounted to about 190 billion rubles. Many of the country's largest funds are interested in purchasing shares. Dividends paid on shares have been around 7% over the past couple of years, which is quite a high figure.

1.

GDR "Rusagro" considered one of best companies for investment. It is the main Russian agro-industrial holding, operating in such areas as the meat, agricultural, oil and fat and sugar industries. In 2015, Rusagro was noted as a fast-growing and profitable company. The holding ranks first among companies producing lump sugar and margarine. The company took second place in pork production. Rusagro was founded in 1997, and in a relatively short period of time it was able to transform from a small agricultural company into a holding company that is a serious competitor in the market today. Every year the company's profitability is growing more and more. Rusagro is an ideal option for long-term, promising cooperation and receiving decent dividends.

Short-term play in the market, when inexperienced speculators make several transactions a day and try to catch some moments to buy or sell, often ends in failure. Approximately 90-95% of people speculating in the market suffer losses or simply reset their accounts. These are harsh realities that cannot be escaped. To learn how to make money on the stock exchange, you need to become an investor and learn to think like an investor. In other words, you need to buy shares of companies for various ideas and invest in stable companies, which in a few years will cost many times more and bring annual dividends. Main task investor - to find such pearls among many companies.

If you are looking for which securities to invest in for a medium-term period of 1-2 years, then you can consider the following portfolio of shares:

1. MMC Norilsk Nickel.

The company is transparent, has consistently strong production and financial performance, a low debt load, pays one of the highest dividends in the sector and is undervalued compared to foreign peers. The main growth driver for MMC Norilsk Nickel shares in the next 2 years will be high dividends and the beginning of a recovery in prices for metals produced by the company. We would invest 20% of the funds in the shares of this company.

2. Alrosa.

The diamond mining company Alrosa is currently not sufficiently valued by the market and has every chance of good capitalization growth in the coming years. You can invest 15% of your funds in Alrosa shares.

3. Rusagro (AGRO on MICEX).

Our top favorite and one of the most promising stocks today. We wrote in more detail about the company, its prospects and dividend forecasts in the review - In Rusagro shares, as the most promising and reliable company, you can invest for a long-term period in the amount of 25% of total funds.

4. Raspadskaya.

The company's shares have a very high growth potential (more than 100%). For many years we have observed a drop in coal prices and Raspadskaya showed annual losses. In 2016, demand for coal from China increased sharply, which led to an increase in the cost of coking coal. The shares responded with growth and the potential remains enormous. The fair price for Raspadskaya shares is 80-100 rubles per share. As soon as the company becomes profitable, dividend payments will begin and the picture will completely change. You can read more about the prospects for Raspadskaya shares in our review -

However, there are risks of investing in Raspadskaya shares. Raspadskaya consists of a group of enterprises, where the main enterprise is the Raspadskaya mine itself. In the event of a mine accident, the company's shares may plummet, since this is the most important asset. The company is currently not diversified (a possible merger with Yuzhkuzbassugol could significantly reduce this risk). We would invest no more than 10% of funds in such a risky but potential asset.

5. Cherkizovo Group.

A well-known food company with strong financial performance, great prospects, low debt burden, decent dividend payments and high stock growth potential. 20% of the funds can be invested in Cherkizovo shares. Cherkizovo leads clear promising business and is the country's largest producer of meat products.

6. Rostelecom pr.

According to our calculations, the preferred shares of the state company Rostelecom are undervalued by 40%. Reliability, low share price, management's interest in capitalization growth and high dividends make the company interesting for investment. Now it is difficult to say when the company's shares will realize their potential, but as a long-term investment, the company is ideal. Rostelecom gets 10% of the portfolio.

So, in our opinion, the most promising stock portfolio for the current year (2 years) is:

The return on shares is formed from two components: dividends and the difference between the initial cost of purchase and subsequent sale of a security on the stock exchange. Both directions have no mutual connection and are not guaranteed. The share price may fall and dividends may not be paid if the company needs funds for its development or to pay off debts. Therefore, when choosing which stocks are best to invest in in 2018, you need to correctly assess the liquidity of the securities themselves, the market position of the issuing company and its policy towards investors.

The most promising sectors for investment

Shares are long-term investments purchased for at least one year. This means that when choosing which stocks to invest in, it is necessary to analyze which sectors of the market will actively develop in 2018 and, therefore, will be able to provide income. Thus, according to experts, the most promising areas for investment in the coming years will be the following areas:

• Metallurgy- this primarily includes enterprises operating in the ferrous metallurgy industry;
• Energy;
• Mechanical engineering and shipbuilding;
• Pharmaceuticals;
• Communications - cellular communication, as well as large Internet providers;
• Finance - banking organizations, insurance companies;
• IT technologies- innovative start-ups;
• Mining enterprises- this mainly includes enterprises for the extraction of non-ferrous metals and precious stones;
• Oil and gas- this includes both mining and processing enterprises;
• Transport companies- passenger and cargo transportation.

Active growth in share prices is predicted for IT companies involved in blockchain technologies and cryptocurrency development. On the other hand, this is one of the highest-risk investment formats, since this market is characterized by dynamic competition. Thus, according to estimates from previous years, almost 92% of all new blockchain startups suspend their work within the first two years of existence.

Where are dividends better: domestic or foreign stocks?

Thanks to a huge number of brokers, the securities market has become accessible to a wide range of investors. At the same time, you can profitably invest money in shares of both domestic and foreign companies. All of them are divided into fully commercial joint-stock companies, as well as enterprises with state participation. The latter can be regulated by law, since the state is interested in regular replenishment budget through dividends. If the company is completely commercial, the payment of dividends is regulated solely by the decision of the meeting of shareholders. And in this case, it is better for you to focus on analytical forecasts and statistics of past periods.

On the domestic and global markets, the situation for companies with state participation is radically different. So, in recent years The Ministry of Finance of the Russian Federation strives to achieve joint stock companies with state participation, payments in the form of dividends of at least 50% of profits. In previous years, this result has not yet been achieved, but the government plans to tighten the requirements. By comparison, most Western companies in this category pay out at least 70% of profits to shareholders, which makes investing in foreign companies a more attractive option. On the other hand, it is much easier to purchase shares of domestic enterprises, as well as to pay taxes on dividends received. Domestic shares are much more accessible from a forecasting perspective.

As of January 2018, the leaders in dividend yield (the percentage of dividend payments to the value of securities) in Russia were the shares of the following joint-stock companies:

• Bashneft(preferred shares) - 10.3%;
• Severstal(regular) - 8.64%;
• NLMK(regular) - 6.94%;
• Tatneft(privileged) - 6.73%;
• Bashneft(regular) - 6.42%.

Investing in dividends on the Ukrainian market is relatively promising only in the Motor Sich company, which paid its shareholders 0.7% in the last reporting period. The highest dividend yield among foreign companies (based on payments for the end of 2017 and the beginning of 2018):

• Vodafone Group PLC - 6,10%;
• AT&T Inc - 5,34%;
• Ford Motor Company - 5,19%;
• Pfizer Inc - 3,65%;
• IBM - 3,63%;
• Exxon Mobil Corporation - 3,49%;
• Qualcomm Incorporated - 3,38%;
• Coca-Cola Company - 3,09%;
• General Electric Company - 2,97%;
• Cisco Systems Inc - 2,77%;
• Boeing Co - 1,99%;
• Apple Inc - 1,47%.

When choosing a country to invest in stocks, preference should be given to countries that are at the stage of economic recovery. This will allow you to get the maximum possible profit, since the release of shares is characteristic of the end of a recession.

If you are aiming to buy shares to receive dividends, it is important to consider that payments are made for a certain reporting period. In turn, at the beginning of a new reporting period, companies present the expected payment rate, which may change. At the same time, the investor needs to regularly monitor company news (most often manually) in order to receive timely information about the decision to pay dividends and the date of payments. The latter is very important because it allows you to determine the date (two business exchange days before the payment date) before which it will be possible to purchase shares and receive dividends on them for the current period.

Growth leaders among securities

Dividends from stocks are a relatively stable but variable income and investors are often more interested in profits from changes in stock prices. So, if an acceptable dividend yield is from 3% to 5% per year, then the profit from exchange rate fluctuations can reach more than 100% per year. Thus, when determining where to invest money in order to get a good profit, you need to know the leaders in stock price growth.

In the Russian market between 2017 and the beginning of 2018, the growth leaders are the following companies:

• Tuchkovsky building materials plant (ordinary shares) - 301,62%;
• INGRAD (PJSC)(regular) - 185.93%;
• Red October(privileged) - 168.80%;
• TGK-2(privileged) - 114.24%;
• Central Telegraph(privileged) - 111.18%.

The following companies showed the best results of rate growth on the Ukrainian stock exchange:

• Dniproenergo - 150%;
• Motor Sich - 113,90%;
• Raiffeisen Bank Aval - 103,15%;
• Donbasenergo - 47,52%;
• Centrenergo - 34,14%;
• Ukrsotsbank - 26,18%.

In the American market, the following companies demonstrated the best performance over the past year:

• Amazon - 67,76%;
• Salesforce - 45,38%;
• Alphabet Inc (Google) - 40,53%;
• Tesla Motors - 35,4%;
• CyrusOne Inc - 21,5%.

In comparison with domestic securities, the growth in the value of shares of the world's largest joint-stock companies seems less profitable, however, it should be taken into account that all quotes provided on the stock exchange are expressed in the corresponding currency of the country of the issuer, which means that when assessing profitability it is important to take into account inflation indicators.

The most liquid shares on the current market

In the professional environment, securities of highly liquid companies are called blue chips. The activity of such shares on the market is determined by the reliability of the issuing companies. In addition, the ability to quickly sell shares determines the minimum degree of risk. On the Russian market, the securities of the following companies have the greatest liquidity as of January 2018:

• Sberbank of Russia;
• Gazprom;
• Moscow Exchange;
• Magnet;

On the Ukrainian stock exchange, the most liquid shares are the shares of issuers:

• Turboatom;
• Raiffeisen Bank Aval;
• Ukrsotsbank;
• Centrenergo.

On international market The most sold and purchased shares at the beginning of 2018 were the securities of the following companies:

• General Electric;
• Mizuho Financial;
• Intel;
• Pfizer;
• Apple;
• Microsoft;
• Cisco;
• Deutsche Bank;
• Coca-Cola.

Of course, liquidity is just an additional indicator that an investor should take into account. Thus, if assessed solely by liquidity indicators, then the shares of a company on the verge of bankruptcy can easily rank alongside highly profitable and stable ones. Therefore, it is more important to forecast the exchange rate based on technical and fundamental analyses.

How to Identify Stocks with the Greatest Growth Potential

Statistical indicators for previous periods are not a guarantee of profit in the future, and therefore it is necessary not only to select leaders in the industry, but also to fulfill additional analysis. Investment multipliers will help with this, allowing you to determine the real potential of the issuer's company, without reference to the scale of the business. In practice, the following types of multipliers are used:

• Earnings per share EPS- a significant increase in profits usually indicates growth.
• The ratio of the current price of a stock on the market to its profitability P/E- demonstrates how much the company pays off, regardless of volume. The lower this indicator, the higher the attractiveness of securities for investment.
• Price to revenue ratio P/S- often used for comparison investment attractiveness different companies operating in the same market sector. A good indicator is considered if it is less than 2. If it is less than 1, then the shares are considered undervalued (the current market value is lower than the price in the event of its liquidation), which is the most attractive option for investment.
• Ratio of capitalization to market flow P/DP- the lower this indicator, the more free money the company has to pay dividends on shares.
• The ratio of the current share price on the market to the value of assets per share P/BV- a good indicator is considered if it is less than 1. This means that the value of the company is higher than the value of its capitalization.
• The ratio of the value of the analyzed company to its profit before taxes EV/EBITDA- if it is below the industry average, then the company is considered undervalued.

At the beginning of 2018, the number of undervalued companies in terms of EV/EBITDA multiple in Russia included:

• Rosseti(electricity network industry) – 1.8 compared to the average of 2.6;
• Gazpromneft(oil and gas) - 3.6 compared to 5.4;
• Raspadskaya(ferrous metallurgy) - 3.8 compared to 5.7;
• Rostelecom(telecoms) - 5.5 compared to 7.9;
• Protek(retail) - 4.7 compared to 6.8;
• Alrosa(mining and non-ferrous metals) - 5.2 compared to 7.9.

On the Ukrainian market, according to the criterion of undervalued shares, the most attractive investment is in the Dneprenergo company, which has a P/S indicator of 0.68.

Which company stocks should you not invest in in 2018?

When identifying the least attractive areas for investment, in addition to analytics financial indicators, should be taken into account general condition market and level of consumer demand. Thus, in recent years, a significant decline has been observed in the sales of consumer goods and the entertainment sector.

The clearest indicator that a company has serious problems that could lead to bankruptcy is a sharp drop in price. According to this parameter, the leaders in decline for 2018 are the following Russian companies:

• Dagestan ESC (ordinary shares) - the fall in value for the year amounted to 89.4%;
• Multisystem - 87,48%;
• Unified Techno Systems - 70,78%;
• Vladimirskaya ESC - 66,91%;
• NPF Future - 64,29%.

In 2017, there was no significant decline in the Ukrainian stock market, however, the largest drop in the value of securities was noted for the following enterprises:

• Yasinovsky Coke Plant - 38,66%;
• Avtokraz - 33,33%.

On the international market, the following companies have the least potential for investment:

• DISH Network Corporation- shares lost 20.48% in price over the year;
• Prosiebensat - 25,11%;
• Subaru Corp - 22,52%.

Thus, returning to the question of which shares are more profitable: domestic or foreign, it can be noted that in comparison with the Russian and Ukrainian markets, foreign companies are more stable in relation to depreciation.

Diversification of risks by industry and category

If you decide to invest money in stocks, it will be quite risky to choose not only one company, but also only one industry. When a certain market sector is experiencing stagnation, then almost all companies operating in the relevant industry will experience difficulties, and, consequently, dividend payments will decrease and the exchange rate will fall shares Therefore, diversification of risks across industries is the best way earn money with minimal risks.

The performance of securities may be affected by various types of risks. Thus, some categories of companies (automotive, construction, durable goods, telecommunications) are characterized by cyclical demand due to the dynamics of the global economy. This means that for Subaru Corp, General Motors, as well as Ford Motor Company, the risk of depreciation is higher than for companies whose activities are characterized by constant demand (electric power, food industry, pharmaceuticals). On the other hand, such fluctuations provide higher profits over long periods. This means that when forming an investment portfolio, it is worth including both shares of cyclical and stable enterprises.

To significantly increase the return on investment, include innovative industries in your portfolio (for example, blockchain projects, alternative energy), as well as shares of large stable corporations (Coca-Cola Company, Gazprom, Alphabet Inc). Balance the number of companies with state participation, whose activities are regulated, and completely private ones in your investment portfolio.

Inflation risk is important, since at a high level of the latter, the growth of assets may be due precisely to depreciation national currency. To minimize such risks, you should include shares of both domestic and foreign companies, selecting alternative options for each industry included in the investment portfolio. For example, by choosing finance as one of the areas, you can invest simultaneously in Deutsche Bank, VTB, Raiffeisen Bank Aval and Bank of America.

When analyzing your options for which stocks to invest in in 2018, you should also consider what results you want to achieve. If this is primarily about saving capital, give preference to companies that are leaders in growth and liquidity. To achieve maximum profits, pay attention to undervalued stocks and the calculation of investment multiples.

Market prospects

Analysts are generally moderately optimistic about the prospects for the Russian stock market in 2018. According to the head of the department of operations on the Russian stock market of Freedom Finance Investment Company Georgy Vashchenko, the market will continue to be dependent on the external background, the mood of foreign players, the situation in raw material sites, and geopolitical factors. “However, the market is far behind the BRICS countries in terms of attracting investment. A positive scenario involves market growth to the level of 2600 points according to the Moscow Exchange index,” he believes.

Bit-Avragim believes that the key driver of market growth will be profits from the oil and gas sector. “If the base scenario is implemented, oil prices will remain above $58 per barrel and the average annual ruble exchange rate will remain at 60 rubles. per dollar (currently the dollar exchange rate is 57 rubles, the price of oil is $67.8 per barrel. - RBC) — the growth potential of the Moscow Exchange index will be about 14% per year,” he says. Director of Analysis financial markets and macroeconomics of Alfa Capital Management Company Vladimir Bragin believes that the Moscow Exchange index can grow by 20% in 2018 due to severe undervaluation in relation to other emerging markets. For example, the ratio of the market value of companies to profit (P/E) in Russia is on average about eight, and in Brazil - about 20, as noted earlier by the head of the analytical department of the management company BC Savings, Sergei Suverov.

Alexey Antonov, an analyst at ALOR Broker, is reserved about the market's prospects. “A lot will be determined by a possible new package of financial sanctions from the United States, in particular that part of it that can be directed at Russian OFZs: this could hit ruble assets, this could be the beginning of a new round of deterioration in Russia’s relations with the world’s largest economy,” - he thinks. Bragin believes that possible negative consequences this step is limited. “At the beginning of the year, there will still be a question of tightening sanctions, but we believe that they will not have a significant impact on the stock market. At the same time, improving company reporting and maintaining high oil prices will maintain interest in Russian shares,” he believes.

Attractive oil and gas

Experts believe that the oil and gas sector will be among the market leaders in 2018. “If we talk about industries, I believe that the oil and gas sector can show the best dynamics while maintaining current oil prices,” says Zinoviev. “Thanks to the growth of the global economy and, as a result, rising energy prices, the oil and gas sector is the main beneficiary,” agrees Bit-Avragim.

In the oil and gas sector, it is worth paying attention to the shares of LUKOIL and NOVATEK - companies with low debt that generate high cash flows in the industry, believes Bit-Avragim. Bragin also notes the shares of LUKOIL, in addition, he calls the shares of Gazprom interesting against the backdrop of a very low stock valuation by historical standards. “Companies such as Gazprom and LUKOIL, for example, are trading at low multiples (price-to-earnings ratio. - RBC) compared to competitors, while providing a dividend yield comparable to ruble deposits in reliable banks,” says Zinoviev. According to him, for example, Gazprom's dividend yield could be at least 7%.

According to Vashchenko, shares of Rosneft, which are now among the most oversold securities (the fall in 2017 was 27%) may also be attractive. “Rosneft is greatly undervalued compared to its global peers,” he says.

In the sector of mining companies, Bit-Avragim also highlights shares of ALROSA. “At the end of the year, diamond prices stabilized. The company is moving towards a strategy of returning capital to shareholders through share buybacks and possible payment special dividend after sale. I believe that the shares will show dynamics better than the market already based on the results of the first quarter of 2018,” he says.

Retail and banks

Bit-Avragim believes that the consumer (Magnit, Aeroflot, Lenta) and banking sectors will be able to show advanced dynamics in 2018 due to the growth of real wages of the population (in January-November 2017, wages of the population adjusted for inflation increased by 3.2%) and, as a consequence, growth in consumer activity. "IN banking sector Sberbank remains the main beneficiary thanks to reductions in transaction costs and ongoing consolidation in the banking sector,” he says.

“I’m betting on Magnit shares - investors have built up excessive negativity in current prices“adds Bit-Avragim. Magnit, the largest retailer in Russia, showed a deterioration in its financial performance in the third quarter of this year. Against this background, shares experienced a panicky decline from 10 thousand to 6.2 thousand rubles. per share, which is, in my opinion, an overreaction to a bad report. I expect that the report for the fourth quarter and for the entire 2017 may be better than expected,” says Veles Broker’s stock advisor Yaroslav Kalugin. In his opinion, the securities have a growth potential of 25-35%.

Vashchenko also draws attention to the shares of VTB, which is now valued by the market below its book value in the absence of significant risks.

Telecom and electricity

Kalugin believes that the most attractive sector in 2018 will be the electricity sector. “For example, for FGC UES, an increase in dividend payments is expected - the dividend yield could be more than 10%. “Rosseti recently adopted a new dividend policy, according to which shareholders can claim 50% of net profit, which will also fuel investor interest in this security,” he gives examples.

He also recommends taking a closer look at the telecommunications sector. “Traditionally, telecommunications companies pay generous dividends, and here you can pay attention to Rostelecom, which pays out 75% of its free cash flow in the form of dividends. Currently, the dividend yield is at 8.4%,” he says.

Vashchenko also believes that individual telecom stocks have significant potential. “Shares of MegaFon and Rostelecom are among the most oversold securities in their sectors. Their dynamics, in my opinion, will be better than the market. “Rostelecom is now worth less than its book value in the absence of significant risks,” he says.

Uninteresting metallurgists

Shares of the metallurgical sector may underperform the market due to the slowdown in steel consumption in China, believes Bit-Avragim. “A correction in the shares of steel companies is possible against the backdrop of falling demand from China,” agrees Zinoviev. This could happen against the backdrop of a general slowdown in China's economic growth.

One of the leaders of growth in 2017 were the securities of MMK and NLMK, and they have already won back a significant part of the potential, which means that in the event of a market correction they will decline more than others, Vashchenko warns.

Smartphones from Apple, cars from Ford, payment Visa cards, a snack at McDonald's, coffee from Strarbucks - these are now an integral part of our lives. You too can become part of this business and earn income from the development of the company. To do this, you just need to buy shares of these corporations. And you can do this on the US stock market.

This review focuses on the sectors American market shares This is the basic unit of classification of companies. There are 11 of them within the S&P 500. Each sector, in turn, is divided into industries.

Sector dynamics since the beginning of the year (data as of May 11, 2017)

Consumer Discretionary

(Consumer goods of secondary necessity)

The most “branded” sector, whose companies are often well-known. Characterized by dependence on fluctuations in the economic cycle.

Industries:

- Automotive components
- Cars
- Distributors
- Diversified consumer services
- Hotels and restaurants
- Durable household goods
- Internet retail
- Entertainment Products
- Media
- Diversified retail
- Specialized retail
- Textiles, clothing and luxury goods

(For a clearer image, click on the table)

Consumer Staples

(Consumer essentials)

It is stable, because essential goods are always needed. The sector's securities are relatively stable when the market falls, but they often do not grow as actively.

Industries:

- Drinks
- Grocery retail
- Food
- Products for the home
- Personal care products
- Tobacco products

(Oil and gas)

We are extremely dependent on raw material quotes. Securities can be an alternative to investing in commodity markets, however, there may be specific risks of the issuer.

Industries:

- Equipment and services for oil and gas
- Oil, gas and fuel consumed

Financials

(Financial)

Financial corporations thrive in conditions economic growth: increased demand for loans and trading activity in the securities market. rise interest rates The Fed is beneficial for many US banks because it improves their interest margins, which makes their securities an attractive investment during this period.

Industries:

- Banks
- Capital markets
- Consumer Finance
- Diversified financial services
- Insurance
- Mortgage REITs
- Mortgage finance

Health Care

(Healthcare)

Less dependent on economic cycles, because people do not choose whether to get sick or not. In the long term, the trend towards aging of the population may play in favor of the healthcare sector. developed countries. The segment has specific risks associated with testing new drugs, competition, patent expiration, and regulatory actions. Biotech is especially volatile, although it is the most disruptive industry.

Industries:

- Biotechnology
- Healthcare equipment
- Healthcare services
- Technologies for healthcare
- Tools and services for research
- Pharmaceuticals

Industrials

(Industrial)

Positively correlates with economic cycles. When the economy is booming, securities are at their best.

Industries:

- Aerospace and defense
- Air cargo delivery and logistics
- Airlines
- Products for construction
- Commercial services
- Construction and engineering
- Electrical equipment
- Industrial conglomerates
- Heavy equipment
- Sea freight transportation
- Professional services
- Railways
- Trading companies and distributors
- Transport infrastructure

Information Technology

(Information Technology)

The driver of growth for the entire US market during the current bull market. This is where it is concentrated large number“growth stocks,” although there are also promising dividend stories within mature companies.

Industries:

- Communication equipment
- Electronic equipment and components
- IT services
- Internet software and services
- Semiconductors
- Software
- Technological hardware

(Materials)

Like oil and gas, they depend on movements commodity markets, including metals.

Industries:

- Chemistry
- Materials for construction
- Containers and packaging
- Metallurgy
- Paper and wood products

Real Estate

(Real estate)

Industries:

- Equity REITs (buys and rents various types of real estate)
- Real estate development

Real Exchange Investment Trust is an exchange-traded fund whose investment object is real estate. They have a high dividend yield. REIT investments allow you to make money on the growth of the real estate market, diversify your investments, and protect yourself from potential inflation in the United States. Moreover, the instrument, unlike real estate, has high liquidity and a low entry threshold.

Telecommunication Services

(Telecoms)

Dividend sector. It is primarily focused on domestic demand, which is why the securities are considered to be “defensive”.

Industries:

- Diversified telecommunications services
- Wireless telecommunications services

(Energy)

A small sector in terms of the number of companies, but it may be interesting as a hedge against crisis trends in the market, as well as receiving high dividend payments. That being said, the renewable energy segment, including solar technology, can deliver high returns in the long run for a patient investor.

Industries:

- Electric power industry
- Gas energy
- Renewable energy
- Diversified energy
- Water energy

In general, choose to your taste! How sectors relate to business cycles, and which industries are our favorites, read the following reviews. Don't forget about such a tool as ETF.

In the meantime, we bring to your attention the following areas of investment: