Gilgongo wrote:I've got a jumble of investments across a number of vehicles (direct holdings, funds, ITs, bonds etc.) and want to keep an eye on how I'm exposed to certain categories beyond the usual shares, bonds and cash.
When it comes to shares, are there any other useful categorisations other than industry sectors? UK vs international I suppose. Is that it?
I use countries rather than UK vs International and split companies into those whose business is mostly domestic and those with mostly international. It's fairly easy, though time consuming, to break down sales and profits for most companies by countries/regions - you just have to go through the annual report to look for the sales data.
Care is needed when it comes to breaking down your investments by sectors. For example, Diageo (multinational distiller, vast majority of business is overseas) and Britvic (soft drinks, about 60% of business is in the UK) are both in the beverages sector yet they have very different exposures. Their subsector designations do point out this difference; Diageo is "Distillers & Vintners" and Britvic is "Soft Drinks".
I suggest being a bit flexible; over the years I've come across quite a few cases where people have been looking for a share which fits a "missing" sector. In doing so they buy something that is very similar to what they already have whilst they've ignored something which would provide much more diversification yet because it doesn't officially fall into that sector's official list of companies they avoid it. Also in some cases the sector classification is dodgy. For example, many businesses in support services more properly belong in construction - they like to be in the support services sector because shares in support service companies generally trade at a higher price-earnings ratio than builders.
I (being lazy) tend to classify a company according to the stock exchange where it is listed. So Manchester United is an "American" share for me because it is listed in New York not London. So on my valuation spreadsheet it sits in the Americans group below Madison Square Garden which is a very American company. But then again most mining companies listed in London are only "British" by virtue of their listing, since many of them have no major operations in the UK.