Businesses are grouped in a market sector, which denotes that they all provide a similar good or service. Grouping businesses together allows investors an easier opportunity to research and investigate each company amongst its peers. An investor can then compare earnings ratios, price-to-book ratios, and other metrics all within one defined sector of the economy. It’s difficult to compare businesses in separate industries, as they would have unique growth prospects. A mature industry such as that of railroad companies can’t expand at the same rate as Internet companies and therefore the fundamental metrics are not the same and can’t be compared at face value.