Breelander wrote:tjh290633 wrote:Some of the allocations are bizarre. I prefer to use my own...
So do I, unfortunately if we all talked in terms of our own private classifications we'd never agree on anything (no change there, then
). For all its flaws (from the HYP perspective) the FTSE Russell Industry Classification Benchmark is a globally recognised standard with a strict rules-based method of classification.
...
And unfortunately, if we use it we get nonsenses like regarding Marks & Spencer as being in the same sector as Halfords and a different sector to Tesco. But walk into the shops and it's easy to see that the types of products sold by Marks & Spencer are basically the same as those sold by Tesco - a different mix of them, with more emphasis on clothing, but both sell food, clothing and household goods - and very different from those sold by Halfords.
And "never agree on anything" is putting it very strongly - anyone wish to argue that AstraZeneca and GlaxoSmithKline are not in the Pharmaceuticals sector, for instance? ;
-) Also, disagreement is IMHO healthy - I
want to see a range of viewpoints (and to present my own). The thing that is much less desirable is letting the disagreements grow into long, unresolvable arguments (*) - once people have expressed their various viewpoints and any
factual errors have been corrected, it's time to agree to disagree and let each HYPer make up their own mind.
So I'm going to continue to use my own sector classifications - which are based on the ICB classification and follow it where I don't have problems with it, but I don't hesitate to deviate from it where I feel it is producing nonsense. Basically, out of encountering some disagreements and basing my investment strategy on nonsense, I regard the former as much the lesser evil!
(*) And yes, I've been guilty of that in the past, and doubtless will again the future. Adhering to principles in the heat of the moment isn't easy... :
-(
Gengulphus