# Sector Rotation Framework

## Early Cycle (Recovery)
- **Characteristics:** Rates falling, growth accelerating, credit spreads tightening.
- **Overweight:** Financials, Consumer Discretionary, Real Estate, Industrials.
- **Underweight:** Utilities, Consumer Staples, Healthcare.

## Mid Cycle (Expansion)
- **Characteristics:** Rates neutral/rising slowly, growth peaking, credit spreads stable.
- **Overweight:** Technology, Communication Services, Industrials.
- **Underweight:** Defensive sectors.

## Late Cycle (Restrictive)
- **Characteristics:** Rates high/peaking, growth decelerating, inflation sticky.
- **Overweight:** Energy, Materials, Healthcare, Consumer Staples.
- **Underweight:** Consumer Discretionary, Real Estate.

## Recession (Contraction)
- **Characteristics:** Rates falling sharply, growth negative, credit spreads blowing out.
- **Overweight:** Utilities, Consumer Staples, Healthcare.
- **Underweight:** Technology, Financials, Industrials, Materials.