Tip #2: Use the Industry Rank to Find Top Stocks that have Outperformed 2 to 1.

Today, let's go over another great benefit that like the Zacks #1 Rank List and Style Scores, will give you an edge in improving the performance of your portfolio: Zacks Industry Rank.

It's no secret that 50% of a stock's price movement can be attributed to the industry group it's in. In fact, studies have shown that just getting into an average stock in a strong industry is likely to outperform a great stock in a poor industry.

But why settle for average when we have a tool that will help you find the best of the best stocks?

The Zacks Industry Rank does just that by sorting companies into more than 250 industry groups. We then calculate the average Zacks Rank for all of the stocks in the industry and rank the industries into two groups:

The top half includes industries with the best average Zacks Rank
The bottom half has the industries with the worst average Zacks Rank

Over the last 10 years, the top half beat the bottom half by a factor of more than 2 to 1. That kind of serious outperformance is why so many investors use this powerful tool for their stock search.

View Zacks Industry Rank »

Now that you've uncovered top stocks in the top industries, you can easily add them to your portfolio tracker on Zacks.com. If you haven't yet set it up, you can do it in just a few minutes.

Setup Your Portfolio Tracker »

¹ The results listed above are not (or may not be) representative of the performance of all selections made by Zacks Investment Research's newsletter editors and may represent the partial close of a position.

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*Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research is not a licensed securities dealer, broker or US investment adviser or investment bank. The Zacks #1 Rank Performance covers a period beginning on January 1, 1988 to April 1, 2024. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank #1 that were rebalanced monthly (see additional details regarding rebalancing below) with zero transaction costs. These are not the returns of actual portfolios of stocks. Zacks Rank #1 stock-rating system returns are computed monthly based on the beginning of the month and end of the month Zacks Rank #1 stock prices plus any dividends received during that particular month. A simple, equally-weighted average return of all Zacks Rank #1 stocks is calculated to determine the monthly return. The monthly returns are then compounded to arrive at the annual return. Only Zacks Rank #1 stocks included in Zacks hypothetical portfolios at the beginning of each month are included in the return calculations. Zacks Rank #1 stocks can, and often do, change throughout the month. Certain Zacks Rank #1 stocks for which no month-end price was available, pricing information was not collected, or for certain other reasons have been excluded from these return calculations. The S&P 500 is an unmanaged index. Visit www.zacks.com/performance_disclosure for information about the performance numbers displayed above.