Sector rotation

Okay kiddo, imagine you have a plate full of different kinds of food - you've got some vegetables, some fruits, some chicken, and some dessert. Now, imagine that each of these foods are like different groups of companies that make products for people to buy.

Sector rotation is like when someone comes and takes away some of the foods from your plate and replaces them with different kinds of foods. This is because some foods are really popular right now and people want to eat more of them, while other foods aren't as popular and people don't want to eat them as much.

Similarly, different groups of companies in the stock market can become more or less popular over time. Sometimes, people want to put more money into technology companies because they think those companies will make a lot of money in the future. Other times, people might want to put their money into healthcare companies because they think those companies will be successful.

So when people talk about sector rotation, they mean that investors are moving their money out of one group of companies and into another group of companies. It's like swapping out some of the foods on your plate for different ones!

Overall, sector rotation is just a way for investors to adjust their investments as the popularity of different kinds of companies changes over time.