Investors need to learn the language of investing if they’re going to make any sort of profits in the market, said Jim Cramer on CNBC's "Mad Money." To help out, he dedicated the show to explaining that jargon. Think of it as a Wall Street-to-English dictionary of sorts.
First up: cyclical versus secular stocks. A company is cyclical if it needs a strong economy in order to perform well. Its fortune depends on the business cycle. Steelmakers like Nucor, machinery firms like Caterpillar and chemical companies like DuPont all fall into this category.
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Secular, on the other hand, refers to companies whose growth remains consistent regardless of the economy. Typically they are manufacturers of foods, drinks, drugs and cigarettes. Some of the most recognizable household brands probably come to mind: General Mills, Coca-Cola, Procter & Gamble. These are classic recession-proof stocks that you to want own when the economy takes a dive because no one stops eating or brushing their teeth just because of a recession.Page 1 of 3 | Next Page