I am new to the FIX world. I am writing an application processing FIX messages in Java and for that I am using QuickFIX/J. I have downloaded the DataDictionary from the home
From the FIXWiki for Components:
Component blocks are sets of related data fields grouped together and are referenced by the component block name in messages that they are used in. Sometimes they are referred to as "Groups".
Component blocks are practical to be defined, and then reused in different message types. Sometimes a repeating group is just for one particular message and then it is not defined as a Component block.
View a component block as a reusable definition of fields. Such a component block may or may not contain a repeating group of fields.
For instance take the Parties component block which is used in many different messages types (see "Used In" on that page). Easy to define once and use in many definitions of messages.