Outliers and laggards

Investors look at sectoral indices to get an idea of the state of sectors. But this practice has its own downside. Sectoral indices are weighted in nature and hence don't communicate the true state of all the companies in the sector. Hence, it is very common for the index to have outliers - companies that have performed better or worse than the index itself. Here are three worst-performing and best-performing sectors in the last five years and one stock that has stood out in each of them. Note that the highlighted numbers denote annualised five-year returns as on May 16, 2019. S&P BSE Telecom -5.6% Telecom has been the worst-performing index in the last five years and the sector that gave the lowest returns during that period, all thanks to Reliance Jio, whose arrival severely hit the earnings of Airtel and Vodafone Idea, which together form more than 50 per cent of the telecom index. Indians now enjoy the cheapest rates of data i