Sector Rotation Strategy: How to Ride the Money Shifts Between Sectors in India
If you’ve been trading or investing in the Indian stock market for a while, you might have noticed that not all sectors move together. Sometimes IT stocks are rallying, while banking stocks are flat. A few months later, FMCG stocks might take the lead while metals cool off.
This shifting performance across industries isn’t random — it’s called Sector Rotation, and learning how to read these shifts can be a game-changer for anyone who wants to learn to trade smartly.
What Is the Sector Rotation Strategy?
The Sector Rotation Strategy is based on one simple observation:
Money in the stock market keeps moving from one sector to another depending on the economic cycle.
For example:
When the economy is recovering, investors often move into banking, auto, and infrastructure stocks.
During slowdowns or uncertain periods, money flows into defensive sectors like FMCG, pharma, or IT.
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