The short version
- A sector ETF holds the companies in one part of the market, such as energy, health care or technology. A world ETF already holds all of them, in proportion to their size.
- Over the year to 16 October 2026, world energy companies rose 58% in pounds and consumer discretionary companies fell 0.4%. The world market as a whole rose 16%.
- Leadership rarely lasts. In 14 years from 2012 to 2025, the previous year's best world sector came top again only 3 times.
- A sector ETF concentrates your money in fewer, similar companies, so it can rise and fall much more than the market.
- The heatmap describes what has happened. It isn't a forecast, and it isn't a reason to buy or sell anything.
- 58 pointsgap between the best and worst world sector over the past year (energy and consumer discretionary)
- 3 of 14years the previous year's best world sector came top again, 2012–2025
- 8 of 10world sectors in an up-trend on the eight rules, at the end of September 2026
How each sector is doing
Over the past year the biggest rises among world sectors were in energy (+58%), information technology (+26%), materials (+19%). The weakest were consumer discretionary (−0%), utilities (+2%), communication services (+6%). The world market as a whole rose 16%. On the eight trend rules, 8 of the 10 world sectors were in an up-trend at the end of September 2026, and consumer discretionary and utilities in a down-trend.
How each sector is doing
Each square is the return over that period, in pounds, for a London-listed ETF that tracks the sector. Green rose, red fell; the stronger the colour, the bigger the move compared with the other sectors. The small squares on the right are the eight trend rules. Open a sector for its price chart.
| Sector | 1 month | 3 months | 6 months | Year to date | 1 year | 3 years, a year | Trend (8 rules) |
|---|---|---|---|---|---|---|---|
| +1.4 | +2.7 | +9.6 | +12.9 | +16.4 | +17.6 | Up 8/8 | |
| +5.7 | +18.6 | +18.0 | +50.4 | +58.1 | +15.3 | Up 8/8 | |
| +1.8 | +6.7 | +22.4 | +24.8 | +26.0 | +28.3 | Up 8/8 | |
| −0.6 | +5.7 | −0.5 | +14.3 | +19.0 | +11.6 | Up 8/8 | |
| +5.3 | +8.5 | +16.1 | +11.3 | +19.0 | +7.0 | Up 8/8 | |
| −1.9 | −0.7 | +9.4 | +8.6 | +16.2 | +22.1 | Up 8/8 | |
| +6.6 | +5.3 | +9.9 | +13.5 | +12.9 | +8.3 | Up 6/8 | |
| −0.6 | −2.0 | +0.1 | +9.5 | +11.9 | +17.0 | Up 7/8 | |
| −1.5 | +0.9 | −0.5 | +3.5 | +5.6 | +20.7 | Up 6/8 | |
| +2.3 | −3.5 | −4.5 | +4.8 | +1.9 | +14.2 | Down 1/8 | |
| +2.8 | −1.5 | +0.5 | −3.0 | −0.4 | +9.0 | Down 1/8 | |
World sectors: Xtrackers MSCI World sector ETFs, returns in pounds to the close on 16 October 2026. Trend rules at the end of September 2026. Sorted by 1 year, biggest rise first.
Use the buttons to switch between world and US sectors and to sort by any period. Hover over, tap or tab to a square for the exact figure. Open a sector to see its price over five years against its 12-month average, with a strip showing which way the trend rules pointed each month.
What a sector ETF is
A sector ETF holds the shares of the companies in one sector of an index, weighted by their size. Xtrackers’ world technology ETF, for example, holds about 130 technology companies from developed countries (DWS); iShares’ S&P 500 technology ETF holds 75 US ones (iShares). The sectors are the 11 of the GICS system, described in The 11 stock market sectors.
A world or S&P 500 ETF already holds every sector, each in proportion to its size in the market. Buying a sector ETF on top changes those proportions. This is the mix at the end of September 2026:
| Sector | MSCI World | S&P 500 |
|---|---|---|
| Information Technology | 31.8% | 39.7% |
| Financials | 15.7% | 11.4% |
| Industrials | 10.8% | 8.0% |
| Health Care | 9.2% | 9.3% |
| Consumer Discretionary | 8.4% | 8.6% |
| Communication Services | 8.3% | 9.9% |
| Consumer Staples | 4.8% | 4.4% |
| Energy | 4.0% | 3.4% |
| Materials | 3.2% | 1.7% |
| Utilities | 2.3% | 1.9% |
| Real Estate | 1.5% | 1.7% |
Share of each index by market value, 30 September 2026. Sources: MSCI World factsheet; S&P Dow Jones Indices (to one decimal place).
Last year's leader is rarely next year's
The heatmap is a snapshot. Over longer stretches the order keeps changing. In the 14 years from 2012 to 2025, the previous year’s best world sector came top again 3 times, and beat the world market as a whole in 8: about as often as a coin toss. The gap between the best and worst world sector in a typical year was 31 percentage points.
World sectors year by year: beat or lagged the whole market
Each square is one sector's return in a calendar year, in pounds. Green means it beat the MSCI World as a whole that year, red that it lagged; the stronger the colour, the bigger the gap. A dark outline marks the best sector each year. 2026 so far is the year to date.
| Sector | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | 2026 so far |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Energy | 0 | −3 | +15 | −7 | −19 | +53 | −4 | −10 | +7 | −33 | +41 | +64 | −2 | +4 | +7 | +50 |
| Materials | −20 | +6 | +1 | 0 | −11 | +43 | +17 | −12 | +18 | +16 | +17 | +1 | +9 | −4 | +18 | +14 |
| Industrials | −9 | +10 | +29 | +6 | +3 | +36 | +14 | −9 | +23 | +8 | +17 | −2 | +17 | +15 | +17 | +10 |
| Consumer Discretionary | −5 | +18 | +36 | +10 | +10 | +25 | +12 | 0 | +22 | +32 | +19 | −26 | +29 | +24 | 0 | −3 |
| Consumer Staples | +8 | +8 | +19 | +13 | +12 | +23 | +7 | −4 | +18 | +4 | +14 | +6 | −3 | +7 | +2 | +14 |
| Health Care | +9 | +12 | +33 | +25 | +12 | +12 | +9 | +8 | +19 | +9 | +22 | +6 | −2 | +2 | +7 | +11 |
| Financials | −19 | +23 | +24 | +9 | +1 | +35 | +13 | −13 | +21 | −7 | +30 | +1 | +10 | +29 | +20 | +9 |
| Information Technology | −3 | +8 | +26 | +23 | +10 | +35 | +26 | +3 | +42 | +39 | +31 | −23 | +47 | +36 | +14 | +25 |
| Communication Services | 0 | +1 | +28 | +4 | +7 | +28 | −3 | −4 | +22 | +18 | +17 | −30 | +40 | +37 | +20 | +4 |
| Utilities | −4 | −3 | +10 | +22 | −2 | +28 | +3 | +9 | +18 | 0 | +12 | +8 | −5 | +15 | +17 | +5 |
| Whole market | −6 | +9 | +25 | +13 | +4 | +30 | +12 | −4 | +23 | +12 | +24 | −8 | +18 | +21 | +13 | +13 |
Energy shows how quickly it can turn. It was the worst world sector in 2014, 2015, 2017, 2019 and 2020, then the best in 2021 and 2022. Technology led in 2017, 2019, 2020 and 2023, but trailed the market in 2022. Research has found that US industries that did well over the past 6 to 12 months went on, on average, to do a little better over the next few months (Moskowitz and Grinblatt, 1999). That is an average across decades and dozens of industries. As the chart shows, it is no guide to which sector will lead in a given year.
Why people use them, and the catches
People use sector ETFs to lean a portfolio towards a part of the market they expect to do well, or away from one, or to hold an industry they know. The catches:
- A few companies can dominate. On 16 October 2026, Apple, Nvidia and Microsoft together made up 50% of Xtrackers’ world technology ETF and 56% of iShares’ S&P 500 technology ETF (DWS, iShares), against about 15% of a world ETF (iShares). Amazon alone was 31% of both consumer discretionary ETFs (iShares), and ExxonMobil 30% of the S&P 500 energy ETF (iShares).
- Bigger swings. All the companies in a sector are exposed to the same things: oil prices for energy, interest rates for utilities and property, consumer spending for retailers. The heatmap shows how far apart the sectors can end up in a single year.
- Higher charges. Xtrackers’ world sector ETFs charge 0.25% a year and iShares’ S&P 500 sector ETFs 0.15%, against 0.07% for iShares’ whole-market S&P 500 ETF (iShares).
- Timing. To gain from a sector you have to buy before it does well and sell before it stops. The year-by-year chart shows how often that changes.
- Currency. Most sector ETFs trade in US dollars in London. Their return in pounds moves with the exchange rate, and some platforms charge a fee to buy a dollar line. Many have a pound line too; UK investment platforms compared lists currency fees.
Sector ETFs you can buy in the UK
Several providers run a full set of sector ETFs, one for each sector of a broad index. These are the main families listed on the London Stock Exchange. They’re named to show what’s available, not as recommendations.
| Family | London tickers | Yearly charge | Traded in | Worth knowing |
|---|---|---|---|---|
| Xtrackers MSCI World sector ETFs MSCI World sector indices | XDWT, XDWF, XDWH, XDW0, XDWC, XDWS, XDWI, XDWM, XDWU, XWTS | 0.25% | US dollars; pound lines too (XXTW, XWFS and so on) | Ten sectors, no real estate. Physical, accumulating. Used in the heatmap. |
| iShares S&P 500 sector ETFs S&P 500 capped sector indices | IUIT, IUFS, IUHC, IUES, IUCD, IUCS, IUIS, IUMS, IUUS, IUCM | 0.15% | US dollars; pound lines for all but communication services (IITU and so on) | US companies only. Physical, accumulating. Used in the heatmap. |
| State Street SPDR MSCI World sector ETFs MSCI World sector 35/20 capped indices | WTEC, WFIN, WHEA, WNRG, WCOD, WCOS, WNDU, WMAT, WUTI, WTEL | 0.30% | US dollars; pound lines for technology, financials, health care and energy | Ten sectors. Physical, accumulating. Smaller funds in some sectors. |
| iShares MSCI World sector ETFs MSCI World sector (Advanced Select) indices | WITS, WENS, WHCA | 0.18% | Pounds | Only technology, energy and health care trade in London. |
| iShares property yield ETFs FTSE EPRA Nareit Dividend+ indices | IWDP (developed world), IUSP (US) | 0.59% / 0.40% | Pounds and US dollars | Property companies picked for dividends: not the same as the real estate sector. Distributing. |
Charges are the issuers' total expense ratios, checked on 20 October 2026. Tickers are the London Stock Exchange lines; a fund often has a line in pounds and one in dollars, which hold the same thing. Named to show what exists, not as recommendations.
Before you use one
- Check what you already hold. A world ETF is already about a third technology. A tech ETF on top adds more of the same companies. The 11 stock market sectors shows the mix inside popular ETFs.
- Look at the top holdings. Some sector ETFs put a large share in a handful of companies.
- Compare the charge with a whole-market ETF, which is often cheaper.
- Know the index: world (MSCI World) or US-only (S&P 500) sectors behave differently.
- Decide how long you’ll hold it. Swapping sectors to chase what has done well means dealing costs, possibly tax outside an ISA, and the risk of arriving late.
How the figures are worked out
The heatmap uses two families of sector ETFs listed on the London Stock Exchange: Xtrackers’ MSCI World sector ETFs for world sectors and iShares’ S&P 500 sector ETFs for US sectors, against iShares Core MSCI World and iShares Core S&P 500 for the whole market. All are accumulating funds, so their prices include reinvested dividends. Most trade in US dollars in London; their prices are converted to pounds at each day’s exchange rate, because that is the return a UK investor actually gets. Returns run to the last close before the page was updated, after the funds’ own charges. The 3-year figure is a yearly average.
Neither family has a London-listed real estate sector ETF, so real estate is left out. Property ETFs that UK investors can buy track different, dividend-focused indices, so they wouldn’t be like for like.
The trend squares are the eight rules from the site’s ETF trend check, taken from Neely, Rapach, Tu and Zhou (2014), on month-end prices: six compare a short average of recent prices with a longer one, and two ask whether the price is higher than 9 or 12 months ago. Six or more pointing up counts as an up-trend, two or fewer as a down-trend. Prices come from Yahoo Finance. Only returns and signals are published, never the prices.
Common questions
- Do I need sector ETFs if I already have a world ETF?
- No. A world ETF already holds every sector, each in proportion to its size in the market. Adding a sector ETF on top means holding more of that sector than the market does. How many ETFs do you need? covers why overlap matters.
- Which sector is doing best right now?
- Over the year to 16 October 2026, it was world energy, which rose 58.1% in pounds. Over three months it was world energy. The heatmap shows every period. Past returns don’t tell you what comes next.
- What does a red square mean?
- In the heatmap, that the sector’s ETF fell over that period, in pounds. In the year-by-year chart, that the sector did worse than the market as a whole that year, even if it rose.
- Why do the returns differ from the fund’s factsheet?
- Factsheets usually show returns in the fund’s base currency, often US dollars, and to the last month-end. These are in pounds, to the last close, so a change in the pound against the dollar shows up here.
- Are sector ETFs riskier?
- Usually, yes. They hold fewer companies, all exposed to the same things, such as oil prices for energy or interest rates for utilities. Their ups and downs are bigger than the whole market’s, as the heatmap shows.
This page describes how sectors and sector ETFs have performed. It isn't a forecast or a recommendation to buy, sell or hold any fund or sector. Past performance is not a reliable guide to future returns, and you may get back less than you put in. Read the full disclaimer.
Sources
- MSCI World Index, MSCI
- The Global Industry Classification Standard (GICS), MSCI
- S&P 500, S&P Dow Jones Indices
- Do industries explain momentum?, Moskowitz, T. J. and Grinblatt, M. (1999), Journal of Finance 54(4), 1249–1290
- Forecasting the equity risk premium: the role of technical indicators, Neely, C. J., Rapach, D. E., Tu, J. and Zhou, G. (2014), Management Science 60(7), 1772–1791
- Xtrackers MSCI World sector UCITS ETFs, DWS product pages and holdings files (the ten funds in the heatmap), 16 October 2026
- iShares S&P 500 sector UCITS ETFs, iShares product pages and holdings files, 16–19 October 2026; IUIT factsheet, September 2026
- iShares Core S&P 500 UCITS ETF and iShares Core MSCI World UCITS ETF, iShares
- State Street SPDR MSCI World sector UCITS ETFs, State Street Global Advisors
- iShares MSCI World sector UCITS ETFs and iShares Developed Markets Property Yield UCITS ETF, iShares
- MSCI World Index factsheet and MSCI World Information Technology Index factsheet, MSCI, 30 September 2026
- S&P 500 and S&P 500 Information Technology, S&P Dow Jones Indices, 30 September 2026
- Daily closing prices of the London listings of the ETFs named in the heatmap and the table, from Yahoo Finance, to 16 October 2026, converted to pounds at Yahoo's GBP/USD rate.
Analysis run 20 October 2026. Fund facts checked on 20 October 2026.