Monday, December 27, 2010

Sector Weighting

A fund's sector weighting is the proportion (percentage) a fund has invested in in various industry sectors. A fund will usually report its sector weightings to clients on a regular basis. Some funds may invest solely in one sector, while index funds will have their sector weightings dictated for them, but active equity managers may actively rotate sectors depending on economic and market trends. Sector weightings are usually calculated based on sector definitions consistent with the GICS or ICB standards.

Synonyms: Sector exposure, Sectors

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