We use the S&P sectors to sort the companies into 11 different sectors. These sectors are known as the Global Industry Classification Standard (GICS). The GICS was created in 1999 by Standard & Poor’s (S&P) and Morgan Stanley Capital International (MSCI). It is used by the majority of the professional investment management community. More than 95% of the world’s listed market capitalization has been classified by GICS.
The GICS sorts companies into sectors based on their primary business activity. Multiple factors are considered, such as a company’s main source of revenue, earnings analysis and market perception. The GICS uses a refined system to sort companies into 11 sectors. These are further divided into 24 industry groups, then into 68 industries, and finally into 157 sub-industries. For the purpose of the database, we only use the 11 fundamental sectors.
Sector - Materials
Companies within the materials sector produce or provide the raw materials needed for many other sectors to function. This includes manufacturers of chemicals and gases and the manufacturers of construction materials, such as sand, cement and bricks. Companies that manufacture metal, glass, paper or plastic containers also fall into this category. Furthermore, the sector includes all companies that mine or produce metals and all companies that produce timber and paper.
Examples of companies in this sector are big names like LG Chem Ltd, Akzo Nobel NV and Northern Star Resources Ltd.