As a prelude to my thoughts on rebalancing, using the data at Google Finance, I made a list of all the economic sub-sectors and found the largest company in the world (based on market capitalization) for each sub-sector that trades on one of the U.S. stock exchanges. The result is the table shown at right. The companies highlighted in yellow are the largest in each sector.
A few observations:
1. Since I associate Retail with goods or 'stuff', it's interesting to remember it's a Service. Retailers don't make the stuff, they provide the service of getting the stuff from the factories to you.
2. Companies with headquarters located in the US comprise 69% of the total market cap for this list. However, US companies comprise only about 36% of the total market cap of all publicly traded companies in the world. Therefore, one can infer that US companies make up a disproportionate share of the world's largest companies.
3. The average Beta of these companies is 1.31 (calculated relative to the S&P 500). One might have assumed a list of the largest companies in the world would have more 'stability' than average, which would have been incorrect. The average Beta for the US companies on the list is 1.28, while the average Beta for non-US companies on the list is 1.37.
1. Since I associate Retail with goods or 'stuff', it's interesting to remember it's a Service. Retailers don't make the stuff, they provide the service of getting the stuff from the factories to you.
2. Companies with headquarters located in the US comprise 69% of the total market cap for this list. However, US companies comprise only about 36% of the total market cap of all publicly traded companies in the world. Therefore, one can infer that US companies make up a disproportionate share of the world's largest companies.
3. The average Beta of these companies is 1.31 (calculated relative to the S&P 500). One might have assumed a list of the largest companies in the world would have more 'stability' than average, which would have been incorrect. The average Beta for the US companies on the list is 1.28, while the average Beta for non-US companies on the list is 1.37.
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