The Global Industry Classification Standard (GICS)

The Global Industry Classification Standard (GICS) is a 4-level classification system developed in 1999 by MSCI and S&P Dow Jones Indices to categorize ... TheGlobalIndustryClassificationStandard(GICS) TheGlobalIndustryClassificationStandard(GICS)isa4-levelclassificationsystemdevelopedin1999byMSCIandS&PDowJonesIndicestocategorizecompaniestradedonpublicstockexchanges.TheGICSistargetedatprofessionalsintheinvestmentbusiness.Inadditiontoclassifyingcompanies,theGICSisusedinthecreationofequityindexes. GetTheGlobalIndustryClassificationStandard(GICS)correspondencetables TheGlobalIndustryClassificationStandard(GICS)crosswalktablestoover50differentindustryclassifications. Gotothestore Learnmore Structure ThecurrentimplementationofTheGlobalIndustryClassificationStandardcategorizescompaniesinto: 11sectors 24industrygroups 69industries 158sub-industries Theclassificationishierarchical,inthateachsub-industrybelongstoonlyoneindustry,eachindustrybelongstooneindustrygroup,andeachindustrygroupbelongstoonesector.Knowingthesub-industrytowhichagivencompanybelongsto,onecaneasilyfindtherelevantindustry,industrygroup,orasectorofthatcompany. Thecodesintheclassificationareresistanttoformattingissues,whenarawclassificationfileisopenedinaspreadsheeteditor,suchasMSExcel.Therearenoleadingzerosandcommaswhichcouldmakethesecodesbetreatedasnumbersandroundedupasaresult(ifyoudon'tknowthetypeoftheproblem,werecommendopeningarawdescriptionfileofNACETheStatisticalClassificationofEconomicActivitiesintheEuropeanCommunity).Witheachlevelofclassification,thenumberofdigitsinthecodegrowsbytwo.Themostgeneric,industrycodesare2-digit(e.g.GICS20-Industrials),andmost-specific,subsectorcodesare8-digitlong(e.g.GICS20304010-Railroads). ThetablebelowshowsthesectorsofTheGlobalIndustryClassificationStandard: Code Description #ofindustrygroups #ofindustries #ofsub-industries 10 Energy 1 2 7 15 Materials 1 5 17 20 Industrials 3 14 25 25 ConsumerDiscretionary 4 11 29 30 ConsumerStaples 3 6 12 35 HealthCare 2 6 10 40 Financials 3 7 17 45 InformationTechnology 3 6 13 50 CommunicationServices 2 5 10 55 Utilities 1 5 6 60 RealEstate 1 2 12 TheGlobalIndustryClassificationStandard(GICS)isa"demand-oriented"classification.Itattemptstogroupcompaniesbasedonhowindividualsandcompaniespurchasetheirproductsandservices,insteadofcategorizingthembasedonwhatproductthecompanymakes,orwhatserviceitprovides(itwouldbea"production-oriented"approach). History&versions TheGlobalIndustryClassificationStandard(GICS)wasdevelopedin1999asaresultofacooperationbetweenMSCIandS&PDowJonesIndices,twomajorprovidersofglobalequityindexes.Atthattimetherewerealreadyotherindustryclassificationsavailable,suchasISIC,NAICS,orSIC,however,theywerenotfitenoughfortheuseinequityinvestments.Mostoftheseclassificationswererelevanttoaparticulargeographicregionandoverrepresentedmanyindustrieswithveryfewpubliclytradedcompanies(e.g.thoseintheagriculturalsector).TheGICScreatorsaddressedtheseissuesbycreatingaglobally-applicableclassificationsystembasedonthequantitative(e.g.revenues,earnings)andqualitativecriteria(e.g.anincreasinglyblurringlinebetweengoodsandservicesinthecurrenteconomy).Theyalsoengagedinmanyconversationswithassetowners,portfoliomanagers,andinvestmentanalyststodevelopaclassificationtargetedattheuseofprofessionalsandinstitutionsintheequityinvestmentbusiness. TheGICSclassificationundergoesayearlyreviewprocess.Todate,therewere11versionofGICSpublished v1-effectivefrom1999untilMarch28,2002 v2-effectiveuntilApril30,2003 v3-effectiveuntilApril30,2004 v4-effectiveuntilApril29,2005 v5-effectiveuntilApril28,2006 v6-effectiveuntilAugust29,2008 v7-effectiveuntilJune30,2010 v8-effectiveuntilFebruary28,2014 v9-effectiveuntilAugust31,2016 v10-effectiveuntilSep28,2018 v11-effectivesinceSep29,2018 PlannedchangestotheGICSclassificationareannouncedwellinadvancewithadocumentsummarizingboththechangesandthereasoningbehindthem.Forexample,changesplannedintheversioneffectivesinceSeptember29,2018,werepublishedonNovember15,2017.Toseeanactualrevisiondocument,checkRevisionsToTheGlobalIndustryClassificationStandardGICSStructurein2018. Whereisitused? TheGICSclassificationwasdevelopedto"toenhancetheinvestmentresearchandassetmanagementprocessforfinancialprofessionalsworldwide".CurrentusesoftheGICSclassificationreflectthatpurpose.TheGICScodesareused: inthedevelopmentandanalysisofequityindexesdevelopedbyS&PGlobalandMSCI.Forexample,customequityindexescanbecreatedwiththedesiredcompositionofdifferentGICSsectorsorindustriesinit(seeS&PGlobalCustomIndexesandMSCICustomIndexes) inGICSDirect,adatabaseofover44,000companieswiththeircorrespondingGICScodes.GICSDirect℠isaserviceofStandard&Poor’sFinancialServicesLLCandMSCI. incategorizingthepubliclytradedcompaniesonNYSEandNASDAQ(seeFidelityInvestmentseresearch) inanalyzingthecurrentstructureofindustriesintheglobalequityinvestmentmarkets.Thatis,sincetheGICSclassificationisupdatedyearlytostayrelevanttothedevelopmentsinindustrystructure,theclassificationitselfprovidesanoutlookintotheimportanceofparticularindustriesandtheirsectors. Furtherresources DownloadGICS TheGlobalIndustryClassificationStandard(GICS)-methodology TheGlobalIndustryClassificationStandard(GICS)-visualrepresentation GICSconversiontables GICS-currenttoNAICS2017-USAconversiontable NAICS2017-USAtoGICS-currentconversiontable GICS-currenttoISICrev.4conversiontable ISICrev.4toGICS-currentconversiontable GICS-currenttoNACErev.2conversiontable NACErev.2toGICS-currentconversiontable GICS-currenttoSIC1987conversiontable SIC1987toGICS-currentconversiontable GICS-currenttoUKSIC2007conversiontable UKSIC2007toGICS-currentconversiontable GICS-currenttoMCCVisaconversiontable MCCVisatoGICS-currentconversiontable GICS-currenttoMCCMasterCardconversiontable MCCMasterCardtoGICS-currentconversiontable GICS-currenttoIndustryClassificationBenchmark(ICB)conversiontable IndustryClassificationBenchmark(ICB)toGICS-currentconversiontable Otherresources OverviewofTheGlobalIndustryClassificationStandard(GICS)byMSCI OverviewofTheGlobalIndustryClassificationStandard(GICS)byS&PGlobal IntroductiontoTheGlobalIndustryClassificationStandard(GICS)byFidelity ComparisonbetweenGICSandotherstockmarketsectorclassifications