Sector Breakdown

DEFINITION of 'Sector Breakdown'

The mix of sectors within a fund or portfolio, typically expressed as a percentage of the equities asset class. Sector designations vary slightly depending on the criteria used, but the most common equity sectors include:

-Industrials/Basic Materials
-Consumer Durables/Staples
-Consumer Cyclicals
-Technology
-Healthcare
-Financials
-Energy
-Utilities

BREAKING DOWN 'Sector Breakdown'

Sectors are a broader classification than industries, although some companies (especially more modern ones) can make a case for being "counted" in several different sectors. Companies within the same sector tend to have relatively high correlations in their rate of revenue and earnings growth, stock price performance, and earnings forecasts - especially over short- and medium-term time periods.

A diversified stock portfolio should hold stocks across most, if not all, sectors. Market weightings of sectors can be found by looking at the composition of a broad index like the S&P 500.

RELATED TERMS
  1. Sector Rotation

    The action of a mutual fund or portfolio manager shifting investment ...
  2. Sector

    1. An area of the economy in which businesses share the same ...
  3. Financial Sector

    A category of stocks containing firms that provide financial ...
  4. Sector ETF

    A class of exchange-traded fund that invests in the stocks and ...
  5. Sector Analysis

    A review and assessment of the current condition and future prospects ...
  6. Market Exposure

    The amount of funds invested in a particular type of security ...
Related Articles
  1. ETFs & Mutual Funds

    How to Choose the Right Sector Funds

    Adding sector funds to your portfolio can pay off but it's important to make sure you're choosing the right market niche.
  2. Markets

    What's a Sector?

    The term sector has several applications in economics and finance.
  3. ETFs & Mutual Funds

    An Introduction To Sector Mutual Funds

    Investing among several different sectors in the economy is a way to diversify your portfolio.
  4. ETFs & Mutual Funds

    Spread Out Risk With Sector-Based ETFs

    These ETFs take the sector rotation strategy from institutional investors and puts it in your hands.
  5. Trading

    Analyzing Mutual Fund Risk

    Find out whether a fund's performance is a result of the manager's abilities, or just a fluke.
  6. ETFs & Mutual Funds

    Financial Funds Provide Diversity ... And Risk

    Sector funds can provide maximum exposure to financial industry stocks, but this benefit is a double-edged sword.
  7. ETFs & Mutual Funds

    Shifting Focus To Sector Allocation

    Investing in sectors may trump international investments for providing diversification.
  8. ETFs & Mutual Funds

    An Introduction To Sector ETFs

    Find out how these specialized ETFs can give your portfolio the punch it needs.
  9. ETFs & Mutual Funds

    Top-Down Analysis: Finding The Right Stocks And Sectors

    The top-down investment strategy depends on economy and market strength. Find out what you should know before jumping in.
  10. Managing Wealth

    Tech Stocks Vs. Financial Stocks in 2016

    Consider the arguments for allocating more of your investment portfolio to either the technology sector or the financial sector for 2016.
RELATED FAQS
  1. How attractive is the internet sector for a growth investor?

    Learn why the Internet sector is an attractive option for growth investors, as well as what many of them do to reduce the ... Read Answer >>
  2. What percentage of a diversified portfolio should be exposed to the banking sector?

    Determine how investing style influences how much of a diversified portfolio should be dedicated to the banking sector, characterized ... 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. How much of a diversified portfolio should be invested in the electronics sector?

    Learn how investing style determines how much of a diversified portfolio an investor chooses to allocate to the electronics ... Read Answer >>
  5. What happens to the intangible assets of a company when it is bought or sold?

    Discover the best-performing stock market sectors over the past five years and learn which sectors continue to offer high ... Read Answer >>
  6. How does being overweight in a particular sector increase risk to a portfolio?

    Learn about the risks of having a portfolio that is overweight in a particular sector and how investors should regularly ... Read Answer >>
Hot Definitions
  1. Quantitative Trading

    Trading strategies based on quantitative analysis which rely on mathematical computations and number crunching to identify ...
  2. Bond Ladder

    A portfolio of fixed-income securities in which each security has a significantly different maturity date. The purpose of ...
  3. Duration

    A measure of the sensitivity of the price (the value of principal) of a fixed-income investment to a change in interest rates. ...
  4. Dove

    An economic policy advisor who promotes monetary policies that involve the maintenance of low interest rates, believing that ...
  5. Cyclical Stock

    An equity security whose price is affected by ups and downs in the overall economy. Cyclical stocks typically relate to companies ...
  6. Front Running

    The unethical practice of a broker trading an equity based on information from the analyst department before his or her clients ...
Trading Center