Why Consumer Discretionary is so important?

Automotive, consumer electronics, luxury goods, retailers, hotels and restaurants. In many economies, this is the largest segment of the economy because it include automobiles (the largest), all retail store, fast food and media companies.

The largest companies in the world that fit this diverse classification are Toyota Motor Corporation, McDonalds and Home Depot.

Because this area needs consumers to be thriving to add these goods to their shopping list, the consumer discretionary sector tends to perform the best during the middle of an upswing in the economy and late in the upswing. As things falter in the economy, this group gets devastated.