Global Industry Classification Standard - GICS

What is the 'Global Industry Classification Standard - GICS'

The Global Industry Classification Standard (GICS) is a standardized classification system for equities developed jointly by Morgan Stanley Capital International (MSCI) and Standard & Poor's. The GICS methodology is used by the MSCI indexes, which include domestic and international stocks, as well as by a large portion of the professional investment management community.

The GICS hierarchy begins with 10 sectors and is followed by 24 industry groups, 67 industries and 147 sub-industries. Each stock that is classified will have a coding at all four of these levels.


BREAKING DOWN 'Global Industry Classification Standard - GICS'

The GICS system was established in 1999 and has since become widely followed through direct use by portfolio managers and benchmarking to MSCI indexes. All told, more than 26,000 stocks worldwide have been classified by GICS, accounting for more than 95% of the world's listed market capitalization. MSCI estimates that more than $3 trillion in assets is benchmarked to its MSCI funds, many of which are sector-specific.

The main goal of GICS is to allow all market participants to classify stocks by standardized industry definitions. GICS is used to make portfolio diversification and overall asset allocation decisions from within a common framework.

GICS competes with the Industry Classification Benchmark (ICB) system, which is maintained by Dow Jones and London's FTSE Group. In practice, most of the same sector and industry designations exist in both standards.

RELATED TERMS
  1. Government Of Singapore Investment ...

    A government-owned company assigned to manage Singapore's sovereign ...
  2. Industry Classification Benchmark ...

    A company-classification system for stocks developed by Dow Jones ...
  3. Window Guaranteed Investment Contract ...

    A type of investment plan where a series of payments are made ...
  4. MSCI All Country World Commodity ...

    A market capitalization weighted index designed by Morgan Stanley ...
  5. Morgan Stanley Capital International ...

    A market-capitalization-weighted index maintained by Morgan Stanley ...
  6. EAFE Index

    An index created by Morgan Stanley Capital International (MSCI) ...
Related Articles
  1. Stock Analysis

    A Guaranteed Zero

    Canadian investors would have done better by buying a conventional guaranteed investment certificate than BMO's "market-linked" product, writes John Heinzl, reporter and columnist for Glo ...
  2. Stock Analysis

    Real Estate Gets Its GICS

    A dedicated sector classification gives real estate securities the recognition they deserve.
  3. Mutual Funds & ETFs

    4 Funds to Short the MSCI Emerging Markets Index (EUM, EEV)

    Discover several strategies to short The MSCI Emerging Markets Index using these four ETFs.
  4. Mutual Funds & ETFs

    The 3 Best ETFs to Short Emerging Markets Equities (EUM, EEM)

    Discover the emerging markets equity asset class, and learn about three different ETFs you can use to get varying amounts of short exposure to it.
  5. Investing News

    Dollar Cost Averaging Case Study: Emerging Markets Stocks (GS, EEM)

    Take a look at how a hypothetical dollar-cost average investment of $100 per month into the MSCI Emerging Markets Index would perform between 2001 and 2015.
  6. Stock Analysis

    MSCI Reclassification Puts Spotlight on These ETFs

    Traders have had bigger fish to fry over the past few days, but a potentially noteworthy news event is slated for the after-market docket on Tuesday. That is when index provider MSCI (NYSE: ...
  7. Investing Basics

    What's a Benchmark?

    A benchmark is a standard investors choose to gauge the performance of their portfolios.
  8. Mutual Funds & ETFs

    4 International Equity Mutual Funds for Steady Returns (OIGAX, FCPAX)

    Discover four international growth mutual funds whose active management styles have spawned successful track records while maintaining low volatility levels.
  9. Mutual Funds & ETFs

    The Top 5 Morgan Stanley Funds for Retirement Diversification in 2016 (MS)

    Learn how to use mutual funds from Morgan Stanley to create a high-growth retirement savings portfolio with global diversification.
  10. Mutual Funds & ETFs

    3 Morgan Stanley Funds Rated 5 Stars by Morningstar

    Discover the three best mutual funds administered and managed by Morgan Stanley that received five-star overall ratings from Morningstar.
RELATED FAQS
  1. What are the main benchmarks that track the banking sector?

    Read about the most important benchmarks that can be used to track the banking sector, and why banking benchmarks tend to ... Read Answer >>
  2. How does an oil and gas company measure and state their reserves?

    Understand how oil and gas companies estimate possible reserves and how different classifications are used to designate the ... Read Answer >>
  3. What are the main benchmarks that track the performance of the financial services ...

    Learn about some of the primary benchmarks utilized by investors and analysts to track the performance of the financial services ... Read Answer >>
  4. What should I use as a benchmark for my small-cap stock portfolio?

    When creating a stock portfolio, it is important to have a benchmark against which you can compare your returns. Comparing ... Read Answer >>
  5. What are the pros and cons of using the S&P 500 as a benchmark?

    Learn about the advantages and disadvantages of using the S&P 500 as a benchmark for portfolio performance, and understand ... Read Answer >>
  6. Where can I find a list of all of the stocks in the S&P 500?

    The actual list of all 500 stocks in the S&P 500 is called the Constituent List. It can be found on the official Standard ... Read Answer >>
Hot Definitions
  1. MACD Technical Indicator

    Moving Average Convergence Divergence (or MACD) is a trend-following momentum indicator that shows the relationship between ...
  2. Over-The-Counter - OTC

    Over-The-Counter (or OTC) is a security traded in some context other than on a formal exchange such as the NYSE, TSX, AMEX, ...
  3. Quarter - Q1, Q2, Q3, Q4

    A three-month period on a financial calendar that acts as a basis for the reporting of earnings and the paying of dividends.
  4. Weighted Average Cost Of Capital - WACC

    Weighted average cost of capital (WACC) is a calculation of a firm's cost of capital in which each category of capital is ...
  5. Basis Point (BPS)

    A unit that is equal to 1/100th of 1%, and is used to denote the change in a financial instrument. The basis point is commonly ...
  6. Sharing Economy

    An economic model in which individuals are able to borrow or rent assets owned by someone else.
Trading Center