Industry Classification Benchmark - ICB
Categories: Index Funds, Metrics
Shoe shopping can be an overwhelming experience. Think about it: if we wander into a place like DSW and have no idea what we’re looking for, there’s a really good chance we’ll never find it, because there are just so many options to choose from. Sneakers, boots, flip-flops, wedges, clown shoes, stilettos, gladiator sandals, loafers…the list goes on and on. And for uninformed buyers, picking and choosing between all of those different kinds of products can be a really time-consuming and frustrating experience. Sometimes it can be so paralyzing that we might opt to just avoid shopping altogether and just wear our old tennies for another year.
Dow Jones and FTSE Russell, two of the biggest names in the securities world, know this, and that’s why they created the Industry Classification Benchmark, or ICB. They don’t want people to forego investing, because they’re overwhelmed by the possibilities. It won’t help us find a pair of shoes, but the ICB can help us find appealing investment opportunities by categorizing securities into easier-to-understand chunks.
The stocks in question are first divided by industry (there are ten industry categories). Then each category is further segmented by super-sector (19 categories), sector (41 categories), and subsector (114 categories). When we’re ready to invest, we can use the ICB categories, which are an internationally-recognized standard of categorization, to find the stocks that most closely align with what we’re looking for.
They publish info daily and weekly, so our stock choices (like our footwear) need never be out of style.
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Finance: What is a Sector Fund?5 Views
Finance allah shmoop What is a sect or fund All
right Well star wars and star trek captains are all
these barking about setting coordinates for sector for stat or
whatever they say That means urgent in the future right
We'll hear space here's sector four and it's Ah well
kind of a slice of space Ok now come back
to earth gently And as it applies to mutual funds
it's kind of the same notion that is A sector
comprises a particular discipline of investing Like think of it
like a slice of the s and p five hundred
Like one sector of the economy is banking Another is
tech Another is telecommunications And then there's oil and transport
And consumer durables in each of these areas has hundreds
of ways in which investors can invest in that particular
sector That is there are index funds that invest in
it Yeah Mutual funds hedge funds private equity funds Even
venture capital funds Each of whom has a particular discipline
or focus on lee in one sector More less so
why would you want to sector fund Well if you
believe that oil was about tohave an explosion in demand
the good kind of explosion Then you'd want to beam
or exposed to it financially at least to its upside
Then say you would technology which you feel has gotten
too expensive in the markets And its best days are
behind it It's A little like putting several of your
eggs into one particular basket because you really like that 00:01:30.519 --> [endTime] basket