Depending on your institution, you may see either the Morningstar Sectors or S&P Sector Weightings in Morningstar Advisor Workstation.
Morningstar divides the economy into three super sectors and 11 sub-sectors. Read the global equity classification methodology.
Cyclical
The cyclical super sector includes industries significantly impacted by economic shifts. When the economy is prosperous these industries tend to expand and when the economy is in a downturn these industries tend to shrink. In general, the stocks in these industries have betas of greater than 1.
The cyclical super sector is made up of the following sectors:
Companies that manufacture chemicals, building materials and paper products. This sector also includes companies engaged in commodities exploration and processing. Companies in this sector include ArcelorMittal, BHP Billiton and Rio Tinto.
This sector includes retail stores, auto and auto parts manufacturers, companies engaged in residential construction, lodging facilities, restaurants and entertainment companies. Companies in this sector include Ford Motor Company, McDonald’s and News Corporation.
Companies that provide financial services which includes banks, savings and loans, asset management companies, credit services, investment brokerage firms, and insurance companies. Companies in this sector include Allianz, J.P. Morgan Chase and Legg Mason.
This sector includes mortgage companies, property management companies and REITs. Companies in this sector include Kimco Realty Corporation, Vornado Realty Trust and Westfield Group.
Sensitive
The sensitive super sector includes industries which ebb and flow with the overall economy, but not severely so. Sensitive industries fall between the defensive and cyclical industries as they are not immune to a poor economy but they also may not be as severely impacted by a poor economy as industries in the cyclical super sector. In general, the stocks in these industries have betas that are close to 1.
The sensitive super sector is made up of the following sectors:
Companies that provide communication services using fixed-line networks or those that provide wireless access and services. This sector also includes companies that provide internet services such as access, navigation and internet related software and services. Companies in this sector include AT&T, France Telecom and Verizon Communications.
Companies that produce or refine oil and gas, oil field services and equipment companies, and pipeline operators. This sector also includes companies engaged in the mining of coal. Companies in this sector include BP, ExxonMobil and Royal Dutch Shell.
Companies that manufacture machinery, hand-held tools and industrial products. This sector also includes aerospace and defense firms as well as companies engaged in transportations and logistic services. Companies in this sector include 3M, Boeing and Siemens.
Companies engaged in the design, development, and support of computer operating systems and applications. This sector also includes companies that provide computer technology consulting services. Also includes companies engaged in the manufacturing of computer equipment, data storage products, networking products, semi¬conductors, and components. Companies in this sector include Apple, Google and Microsoft.
Defensive
The defensive super sector includes industries that are relatively immune to economic cycles. These industries provide services that consumers require in both good and bad times, such as healthcare and utilities. In general, the stocks in these industries have betas of less than 1.
The defensive super sector is made up of the following sectors:
Companies engaged in the manufacturing of food, beverages, household and personal products, packaging, or tobacco. Also includes companies that provide services such as education & training services. Companies in this sector include Philip Morris International, Procter & Gamble and Wal-Mart Stores.
This sector includes biotechnology, pharmaceuticals, research services, home healthcare, hospitals, long-term care facilities, and medical equipment and supplies. Companies in this sector include Astra Zeneca, Pfizer and Roche Holding.
Electric, gas, and water utilities. Companies in this sector include Electricité de France, Exelon and PG&E Corporation.
Not Classified
Not all individual stocks or all securities in fund portfolios can be identified or classified by Morningstar. If a security cannot be identified or classified, it will be reflected in this number.
The S&P Sector Weightings are part of the Global Industrial Classification System (GICSSM), GICS is an industry classification system developed by Standard & Poor's in collaboration with Morgan Stanley Capital International (MSCI).
A company is assigned to one of 122 GICS sub-industries according to the definition of its principal business activity as determined by Standard & Poor's and MSCI. The sub-industries are classified into 59 industry groups, which are then used to construct 23 industry groups and 10 separate sectors. The 10 sectors are listed in Advisor Workstation:
Consumer Discretionary
Consumer Staples
Energy
Financials
Health Care
Industrials
Information Technology
Materials
Telecommunication
Utilities
Not Classified
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