Sector rotation


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Sector rotation

An active asset management strategy certain sectors, that tactically overweights and underweights depending on expected performance. Sometimes called rotation.

Sector Rotation

An investment strategy in which a portfolio overweights or underweights certain sectors in accordance with expected performance. Sector rotation is a form of active investment management; the portfolio manager observes market trends and alters the composition of the portfolio in order to earn the highest possible return. Sector rotation is fairly high risk, as a portfolio's systematic overweighting and underweighting means that is not efficiently diversified. See also: Markowitz portfolio theory.

sector rotation

An investment strategy involving the movement of investments from one industry sector to another in an attempt to beat the market. For example, an investor might rotate investments among consumer durables, technology, and energy securities as economic fundamentals and valuations in each of these sectors change. Also called group rotation.

Sector rotation.

Sector rotation refers to the shifting of investments among different sectors of the economy.

At any given time, certain sectors will be performing better than others. Investment managers use sector rotation strategies to capitalize on the current economic cycle and maximize profits.

References in periodicals archive ?
Picking individual stocks is the most time-consuming approach to sector rotation.
We're delighted to have our L2 Sector Rotation Strategy part of the Placemark family of offerings.
Success in energy investing requires a nuanced, sophisticated grasp of positioning, sentiment and sector rotation as the smart money discounts the future in the financial kingdoms of black gold.
Eoe1/4EoLooking forward, the managersEoe1/4ao view is that the market will be led more by fundamentals and earnings as opposed to flows or sector rotation,Eoe1/4Y said Demartini.
Typical Cash Management Portfolio Characteristics Portfolio Attribute Active Management Passive Management (Fee-Based) (Non-Fee-Based) Trading Activity Strategies incorporate Strategies can be wider range of asset similar to actively classes, sector rotation, managed portfolio but duration changes and with appreciably less reflect greater credit trading activity flexibility Compensation Fixed fee based on assets Spread/mark up on per- under management.
Another factor: sector rotation -- the substantial increase in trading volume as investors are moving from one group of stocks to another.
During this phase of the cycle, periodic (equity market) sector rotation is also a feature.
The alpha quest now morphs into stock selection sector rotation and active rupee hedging.
David Cumming at Standard Life Investments, for example, attempted to take advantage of sector rotation and rapid changes in sentiment in July/August and added to existing positions in Barclays, Lloyds and RBS.
However, the stock does seem to be suffering from sector rotation into more cyclical names whenever there are periods of heightened confidence on economic recovery.
But that's not sufficient to trigger normal sector rotation that one often sees in these circumstances.
Tech stocks, including semiconductors, are showing weakness when looking at S&P sector rotation trends.