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Fund sectors

Sector definitions

Each of the Investment Association sectors has a clear definition setting out the criteria that funds must fulfil. Most sectors are organised around the principal asset types in which the fund should invest.

For example, the UK All Companies sector comprises funds that invest at least 80% of their assets in UK equities, which have a primary objective of achieving capital growth. Within any Investment Association sector, the funds may offer a considerable variety of specific asset mixes, strategies and risk profiles.

Here you can look up individual sector definitions.

What are the sectors?

There is a huge variety of funds on sale in the UK. The Investment Association sectors provide a way of dividing around 3,000 of these funds into broad groups. Investors and their advisers can then compare funds in one or more sectors before looking in detail at individual funds.

Looking at sectors will not inform advisers and investors about the relative risks of funds. The literature of any fund should always be read. What is suitable or even best for an individual person depends on personal circumstances and not merely the sector classification.

Managing the sectors

The sectors are run by our staff and are overseen by the Sectors Committee. Fund providers choose the sector into which they would like their fund classified and submit their request for review.

The funds are checked by an independent monitoring company every month to ensure they comply with the sector definition. To support the integrity of the sectors, The Investment Association takes action against funds that do not comply.

Find out more about how sectors are managed and the Sectors Committee’s regular reviews.

How sectors are organised

Funds are broadly split between those that aim to produce income and those that aim for capital growth. These are further classified based on the type of asset, region or industry sector in which they invest. A few sectors are focused on capital protection, such as Money Market funds, or are in the Specialist category. Some choose to remain Unclassified. The Targeted Absolute Return sector contains funds that aim to produce positive returns in all market conditions and we carefully monitor their performance.

Find out more about sector classification.


One of the most important ways in which the sector framework is used by the industry, including fund selectors and distributors, is to compare performance. Performance data IS NOT collected by the Investment Association but by data vendors who use it to create ranking tables and calculate sector averages.

The Investment Association believes that, as far as possible, there should be a common basis for comparison and have sought to facilitate this by helping the data vendors identify a ‘primary’ share class in the post RDR world. More information on this topic is provided.

The Investment Association has not licensed a methodology for the calculation of sector average performance, believing it to be more appropriate for the commercial market to develop transparent processes. We have never stipulated, and do not believe it is our role to stipulate, precisely how individual sectors are analysed.