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There are three competing systems for classifying stocks into sectors and industries: the Global Industry Classification Standard (GICS), the Industrial Classification Benchmark (ICB), and Morningstar's stock sector structure. For the most part, the systems are functionally equivalent, but unfortunately the terminology is different.
The Industry Classification Benchmark or ICB, was developed by Dow Jones and FTSE, and is used by the NASDAQ and New York Stock Exchanges. The ICB structure consists of 10 industries, 19 supersectors, 41 sectors and 114 subsectors. So the highest level is an "industry". The ICB system is used by most Dow Jones and FTSE indexes.
The ten industries are:
The Global Industry Classification Standard (GICS) was developed in 1999 by MSCI and Standard & Poor's for use by the global financial community. The GICS structure consists of 11 sectors, 24 industry groups, 68 industries and 157 sub-industries. The highest level is a "sector", unlike with the ICB system, where the highest level is an "industry". GICS is used as a basis for S&P and MSCI financial market indexes. Originally, the GICS system had 10 sectors, but in 2016, real estate was turned into its own sector rather than being part of the financials sector.
The eleven sectors are:
Note that prior to September 2018, the "Communication Services" sector of the GICS was named the Telecommunication Services sector. Previously, the Telecommunication Services sector was pretty small. As part of the renaming, the sector was expanded to include companies that facilitate communication and offer related content and information through various media.
The main differences between "industries" with the ICB system and "sectors" with the GICS system are 1) the GICS breaks out real estate as its own sector; and 2) the GICS and ICB systems treat consumer stocks differently. The ICB system classifies consumer stocks between "consumer goods" and "consumer services", whereas the GICS system classifies them as as either "consumer staples" or "consumer discretionary".
The Morningstar stock sector structure consists of 11 sectors (the highest level in their system is also a "sector"). Underneath the 11 sectors, Morningstar uses 150 industries.
The eleven sectors are:
At StockMarketMBA.com, we use the GICS terminology to classify securities. So our highest level of grouping is a "sector". Underneath sectors, we use the terminology of an "industry". We are actually using Morningstar's industry system, in which all stocks are classified into one of 150 industries - see our list of industries. So in our website, every stock is classified into one of the 150 Morningstar industries and then into one of the 11 GICS sectors. We know that seems odd, but we do that for practical purposes - our data providers just happen to give us the most consistent data doing it that way.
In any given year, the different sectors of the stock market can have significantly different performance. The different sectors also act differently during different economic conditions and cycles. So stock market investors have always paid significant attention to sector performance. You can use this tool on our website to analyze S&P 500 sector performance.
There are a handful of ETFs that attempt to dynamically invest in those sectors of the stock market that are currently performing well. See our discussion of sector rotation ETFs.
State Street (SPDRs) has a line of ETFs that follow indexes that split the stocks in the S&P 500 into the 11 stock market sectors of the GICS system. These sector ETFs are heavily traded:
| ETF | Description | Average Volume | 1 Year | 3 Years | Actions |
|---|---|---|---|---|---|
| SPY | SPDR S&P 500 ETF | 110,098,257 | -9.96% | 27.20% | |
| XLB | Materials Select Sector SPDR ETF | 7,869,704 | -8.62% | 38.57% | |
| XLC | Communication Services Select Sector SPDR ETF | 7,257,548 | -16.61% | 10.96% | |
| XLE | Energy Select Sector SPDR ETF | 25,745,311 | 8.83% | 69.92% | |
| XLF | Financial Select Sector SPDR ETF | 77,671,192 | -19.49% | 10.94% | |
| XLI | Industrial Select Sector SPDR ETF | 14,977,836 | -1.92% | 30.77% | |
| XLK | Technology Select Sector SPDR ETF | 8,620,951 | -3.58% | 61.88% | |
| XLP | Consumer Staples Select Sector SPDR ETF | 13,146,190 | -4.20% | 17.44% | |
| XLRE | Real Estate Select Sector SPDR ETF | 7,322,868 | -23.18% | -10.35% | |
| XLU | Utilities Select Sector SPDR ETF | 16,037,079 | -6.22% | -3.25% | |
| XLV | Healthcare Select Sector SPDR ETF | 11,665,335 | -3.38% | 29.51% | |
| XLY | Consumer Discretionary Select Sector SPDR ETF | 6,746,143 | -18.71% | 21.49% |
Powershares has a line of ETFs that follow indexes that split small cap stocks into the 11 stock market sectors of the GICS system. This list only includes 9 sector ETFs because real estate is included with the financials sector and telecommunications is included with utilities.
| ETF | Description | Average Volume | 1 Year | 3 Years | Actions |
|---|---|---|---|---|---|
| IJR | iShares Core S&P Small-Cap ETF | 5,541,013 | -14.16% | 72.85% | |
| PSCC | S&P SmallCap 600 Consumer Staples Sector ETF | 5,086 | -3.13% | 47.09% | |
| PSCD | S&P SmallCap 600 Consumer Discretionary Sector ETF | 1,039 | -22.41% | 49.42% | |
| PSCE | S&P SmallCap 600 Energy Sector ETF | 178,499 | 28.18% | 63.56% | |
| PSCF | S&P SmallCap 600 Financials Sector ETF | 1,764 | -19.56% | -6.74% | |
| PSCH | Invesco S&P SmallCap 600 Health Care ETF | 6,570 | -26.67% | 22.10% | |
| PSCI | S&P SmallCap 600 Industrials Sector ETF | 3,270 | -8.62% | 39.69% | |
| PSCM | S&P SmallCap 600 Materials Sector ETF | 1,095 | 1.06% | 48.54% | |
| PSCT | S&P SmallCap 600 Information Technology Sector ETF | 3,024 | -14.20% | 55.14% | |
| PSCU | S&P SmallCap 600 Utilities & Communication Services Sector ETF | 1,031 | -17.53% | 9.14% |
Fidelity has a line of ETFs that follow indexes that split the entire stock market into the 11 stock market sectors of the GICS system. These are based on MSCI's "investable market indexes" or IMI indexes. IMI indexes include large, mid and small cap stocks.
| ETF | Description | Average Volume | 1 Year | 3 Years | Actions |
|---|---|---|---|---|---|
| FCOM | Fidelity MSCI Telecom Svcs ETF | 76,837 | -21.71% | 0.34% | |
| FDIS | Fidelity MSCI Consumer Discretionary ETF | 97,128 | -20.85% | 29.27% | |
| FENY | Fidelity MSCI Energy Index ETF | 872,253 | 0.38% | 194.27% | |
| FHLC | Fidelity MSCI Health Care Index ETF | 176,363 | -8.95% | 50.16% | |
| FIDU | Fidelity MSCI Industrials Index ETF | 103,865 | -3.21% | 16.70% | |
| FMAT | Fidelity MSCI Materials Index ETF | 100,522 | -8.26% | 28.29% | |
| FNCL | Fidelity MSCI Financials Index ETF | 246,353 | -24.21% | -3.77% | |
| FREL | Fidelity MSCI Real Estate Index ETF | 1,087,289 | -26.73% | 28.89% | |
| FSTA | Fidelity MSCI Consumer Staples Index ETF | 161,048 | -5.34% | 15.10% | |
| FTEC | Fidelity MSCI Information Technology ETF | 248,696 | -8.26% | 81.59% | |
| FUTY | Fidelity MSCI Utilities Index ETF | 258,218 | -9.10% | 16.95% |
All data is a live query from our database. The wording was last updated: 04/14/2020.
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