The S&P 500 is a market index that also defines firms into sectors, industries and contain specific firms. A link is provided below with the standard sector/industry breakdown used by the S&P. https://eresearch.fidelity.com/eresearch/markets_sectors/sectors/sectors_in_market.jhtml

The S&P 500 identifies ten different sectors and industries within each sector.

Consumer Discretionary (12 industries),

Consumer Staples (6 industries),

Energy (2 industries),

Financials (8 industries),

Health Care ( 6 industries),

Industrials (14 industries),

Information Technology (8 Industries),

Materials (2 industries),

Telecommunication Service (2 industries),

Utilities (5 industries).

If you go to the link above, it will allow you to see each industry within the sectors. Sector analysis is fundamental to managing an investment portfolio that provides returns that are superior to market returns. This requries an understanding of the current economic conditions, forecasts about the future, and consensus forecasts about future earnings prospects within sectors/industries and specific firms. In this excercise, you will need to select 1 to 3 sectors and then 1 industry within each sector to that you think will outperform the S&P 500 over the next year.

1. You are required to complete the following tasks:

(a) identify sectors and industry: identify 1 to 3 sectors and 1 industry within each sector that will be used complete this exercise. The sectors selected should be on the basis of their past behavior that was pro cyclical, counter cyclical or a neutral sector sector/industry.

(b) Perform fully analysis: The first part of the analysis is to perform a SWOT analysis on each sector/industry selected. Identifying its strengths, weakness, opportunities and threats. Look at the sector, such as utilities, they are neutral. People always need electricity, water and gas.

(c) Analyze past performance: This require you to research on past performances during recessions and periods of growth which will help you determine whether they are pro, counter, or neutral sector cyclically.

(d) Present research on future economic scenarios: Another source of information would be consensus forecasts of the sector and industry performance. Demonstrate why these particular sector(s)/industries will outperform the overall market: This requires understanding some of the key drivers in the industry such as consumer spending, consumer spending on durable products.