The AIC classifies investment companies into different sectors to help you find and compare investments
Why is sector classification important?
When you’re choosing an investment company, there can be a baffling range on offer. It helps if you narrow your choices down to ones that are most likely to suit you.
A good place to start is to decide which sectors offer the right characteristics. For example, if you are looking for income, you might want to consider sectors that specialise in delivering a high or growing income. Alternatively, you might want a good general investment company that invests globally and which aims to deliver both income and capital growth.
If you already have a reasonably well-balanced portfolio, you might be looking for something more specialist.
We have sectors which focus on particular parts of the world, or individual countries. Some focus on particular types of assets (e.g. property, private equity). Bear in mind that specialist investment companies can be more risky as they focus on one particular investment area.
What do AIC classifications mean?
The AIC classifies all investment companies into sectors. The classification framework provides a way of grouping companies with common characteristics to make it easier to search and compare within particular sectors.
Classifications are based on a combination of:
- regional or industry focus, and
- the company's investment objective
These classifications aren’t exact, since no two companies are ever the same, and there are no guarantees of a return on your investment.