Canada A record of a unitholder's current investments and transaction history.
Account Transfer
Canada See Transfer.
Account Type
Canada See Plan type.
Account Value
Canada The total dollar value of mutual fund units in a unitholder's account. It is calculated by multiplying the number of fund units held in an account by the current net asset value per unit (NAVPS). If the account includes more than one fund, the results of this calculation for each fund are added together to obtain the value of the account.
Accrued Interests
Canada Interest that has been earned but not received.
Accumulation Plan
Canada An arrangement which enables an investor to purchase mutual fund shares regularly in large or small amounts.
Accumulation Units/shares
Europe With this type of unit/share any income earned remains accumulated within the price of your unit/share, increasing the value of you holding
Active Management
Europe Funds which aim to outperform a benchmark index, such as the FTSE 100. The aim is for the fund manager to manage the fund's investments in such a way that the fund will generate better returns than you might receive in a passive managed fund.
Asia An investment strategy which aims to outperform a particular market or sector. Active managers have full flexibility in deciding what securities to buy and sell based on investment research, market forecasts, and their own judgment.
Adjusted cost base
Canada Cost base for determining capital gains and capital losses. Consists of the original purchase price of a mutual fund and any expenses related to the purchase, such as brokers' commissions.
Canada A financial correction to an investor's account.
Canada A court appointee who looks after the estate of a person who dies without a will. The duties are similar to those of an executor.
USA An organization employed by a mutual fund to give professional advice on the fund's investments and asset management practives (also called the investment adviser)
After Tax Return
USA The total return of a fund after the effects of taxes on distributions and/or redemptions have been assessed. Funds are required by federal securities law to calculate after-tax returns using standardized formulas based upon the highest tax rates. (Consequently, they are not representative of the after-tax returns of most mutual fund shareholders.) These standardized after-tax returns are not relevant for shareholders in taxdeferred retirement accounts.
Aggressive Growth Fund
Asia An investment strategy that focuses on investing in stocks, which the fund manager expects will experience substantial growth in earnings per share in the near term. The companies in question are generally small or mid capitalization in size.
Canada See Annual information form.
Annual Management Charge (AMC)  
Europe A fee paid to the fund manager once a year which covers the cost of investment management and administration. It is normally 0.75% - 1.5% p.a. and is charged to the fund.
Annual Report
Europe Includes details of the fund's investments and how it has performed with more general financial information relating to the fund. It is sent to you by your fund manager at the end of each financial year.
Canada A financial report sent yearly to a publicly held firm's shareholders. This report must be audited by independent auditors.
Annual Return
Asia The average annual profit or loss realized by an investment at the end of a specified calendar period.
Annual and Semiannual Reports
USA Summaries that a mutual fund sends to its shareholders that discuss the fund's performance over a certain time period and identify the securities in the fund's portfolio on a specific date
Canada An individual who purchases an annuity and will receive payments from that annuity.
Canada A contract that guarantees a series of payments in exchange for a lump sum investment.
USA An increase in an investment's value.
Asked or offering price
USA The price at which a mutual fund's shares can be purchased. The asked or offering price includes the current net asset value (NAV) per share plus any sales charge.
Canada A proposal to sell a specific quantity of securities at a named price.
USA The current dollar value of the pool of money shareholders have invested in a fund.
Europe Usually stocks and shares, fixed interest securities or cash, these are the 'building blocks' in which a fund invests
Canada What a firm or individual owns.
Asset Allocation
Europe A term to describe how your money is invested. In most cases, the fund manager will spread money across a range of different assets and companies in order to diversify your holdings and help to spread risk.
Asia An investment that has a low statistical correlation of its risks and returns with traditional investments such as stocks or bonds.
Canada The chartered accounting firm (or its employees) responsible for conductint an audit.
Authorized Corporate Director (ACD)
Europe The term used to describe the manager of an OEIC fund. An ACD has the same role and responsibilities as their unit trust equivalents, known as the fund manager.
Authorized Fund
Europe A unit trust or OEIC that is authorised by the regulators for promotion to the general public.
Asia A unit trust or mutual fund that meets the requirements of the regulator and is allowed to be sold. Authorisation does not imply recommendations by the regulator.
Authorized Shares
Canada The total number of shares a company can issue under the terms of its charter. In the case of an open-end mutual fund corporation, the charter permits an unlimited number of shares to be issued.
Automatic Reinvestment
USA A fund service giving shareholders the option to purchase additional shares using dividend and capital gain distributions.
Automatic Withdrawal Plan (AWD)
Canada See Systematic withdrawal plan.
Average Cost
Canada A weighted average of the price paid per unit, based on the total units purchased in an account.
Average Portfolio Maturity
USA The average maturity of all the securities in a bond or money market fund's portfolio.
Canada See Automatic withdrawal plan and Systematic withdrawal plan.
Back-end Load
Canada A sales charge levied when mutual fund units are redeemed.
Balance Sheet
Canada A financial statement showing the nature and amount of a company's assets, liabilities and shareholders' equity.
Balanced Fund
Europe A type of fund which restricts its investment in equities, to a maximum of 85% of the fund's holdings, in order to invest in other types of investments such as bonds. This type of fund aims to benefit from the performance of its bond investments when equities are not performing well and vice versa.
Asia A unit trust or mutual fund that aims to provide some combination of growth, income, and conservation of capital by investing in a mix of stocks, bonds, and/or money market instruments.
Canada A mutual fund which has an investment policy of 'balancing' its portfolio generally by including bonds and shares in varying proportions influenced by the fund's investment outlook.
Bank Rate
Canada The rate at which the Bank of Canada makes short-term loans to chartered banks and other financial institutions, and the benchmark for prime rates set by financial institutions.
Bankers' Acceptance
Canada Short-term bank paper with the repayment of principal and payment of interest guaranteed by the issuer's bank.
Bear Market
USA A period during which securities prices in a particular market (such as the stock market) are generally falling.
Canada A declining financial market.
Benchmark Index
Europe A stock market index, such as the FTSE 100, which is used to measure the overall performance of the shares that are contained within it. Fund managers try to outperform any gains made by their fund's benchmark index.
Bid or Sell Price
USA The price at which a mutual fund's shares are redeemed, or bought back, by the fund. The bid or selling price is usually the current net asset value (NAV) per share. See Net Asset Value (NAV) and Redeem.
Europe Some unit trusts have separate prices for buying and selling units. The bid price is the selling price of your units.
Canada A statistical term used to illustrate the relationship of the price of an individual security or mutual fund unit to similar securities or financial market indexes.
Bid/Offer Spread
Europe For dual-priced unit trusts this is the percentage difference between the buying and selling prices of your units. The buying or offer price is normally higher than the selling or bid price as it will include an initial charge to be paid to the fund manager for setting up and administering your units.
Asia The difference between the fund's buy and sell price.
Bid Price
Asia Beta is a historical measure of an investment's sensitivity when compared to a benchmark. It represents the percentage change in a fund's value for each 1% change in the fund's benchmark. If the beta is more than 1, the investment typically moves (which can be up or down) more than the benchmark. Generally, the higher the correlation is between the investment and its benchmark (as measured by R-squared), the more meaningful the measure of beta.
Canada A proposal to buy a specific quantity of securities at a named price.
Blue Chip
Europe Large well established companies which are generally considered to be stable. In the UK, such British companies are usually listed on the FTSE 100 index.
Canada A descriptive term usually applied to high grade equity securities.
Board Lot
Canada A standard number of shares for trading transactions. The number of shares in a board lot varies with the price level of the security, although in most cases a board lot is 100 shares.
Board of Directors
Canada A committee elected by the shareholders of a company, empowered to act on their behalf in the management of company affairs. Directors are normally elected each year at the annual meeting.
USA A debt security issued by a company, municipality, or government agency. A bond investor lends money to the issuer and, in exchange, the issuer promises to repay the loan amount on a specifi ed maturity date; the issuer usually pays the bondholder periodic interest payments over the life of the loan.
Europe Also known as fixed interest securities bonds are investments which pay a fixed rate of interest and have a fixed term. Governments or companies may issue them. Those issued by Governments are known as gilts. Not to be confused with investment bonds issued for individual investors usually by insurance companies.
Asia A unit trust or mutual fund that invests in debt securities issued normally by corporations and government. Bond funds generally emphasise on regular income stream.
Canada A long-term debt instrument with the promise to pay a specified amount of interest and to return the principal amount on a specified maturity date.
Bond Fund
Canada A mutual fund whose portfolio consists primarily of bonds.
Book Value
Canada The value of net assets that belong to a company's shareholders, as stated on the balance sheet.
USA The dollar amount at which many mutual funds offer reduced sales charges (or 'loads') to investors. The amount of a discount varies, depending upon the amount of the investment. The higher the level of investment, the greater the likelihood of a breakpoint discount and the greater the discount. 2006 ICI Fact Book 131 Glossary of Terms
Canada An agent who handles the public's orders to buy and sell securities, commodities, or other property. A commission is generally charged for this service.
USA A firm that buys and sells mutual fund shares and other securities from and to investors.
Bull Market
Canada An advancing financial market.
Buying on Margin
Canada Purchasing a security partly with borrowed money.
Canada Preferred shares or bonds that give the issuing corporation an option to repurchase, or 'call' those securities at a stated price. These are also known as redeemable securities.
Canada Savings Bond
Canada A bond issued each year by the federal government. These bonds can be cashed in at any time for their full face value.
Cancellation Price
Europe For dual-priced unit trusts this is the lowest possible price at which an investor can sell units back to the manager. It excludes exit charges. The cancellation price represents the proceeds the fund would receive if the fund's assets were sold.
Europe The amount of money you initially put into your savings or investments before it receives any interest or capital growth. In a fund 'capital' can also refer to the assets held by the fund excluding any income the fund may receive.
Canada Generally, the money or property used in a business. The term is also used to apply to cash in reserve, savings, or other property of value.
Capital Cost Allowance
Canada A taxation term, equivalent to depreciation, that makes allowance for the wearing away of a fixed asset.
Capital Gain
Canada The amount by which the value of an investment exceeds its cost. Mutual fund investors can receive a capital gain in two ways. A gain on the sale of securities in the fund's portfolio may be distributed to the investor of mutual fund trusts on a pro rata basis or included as part of a dividend from mutual fund corporations. The investor may also realize a gain on the redemption of his or her units of the fund.
Capital Gain Distribution
USA Profits distributed to shareholders resulting from the sale of securities held in the fund's portfolio.
Capital Growth
Europe The increase in the value of your investment, excluding any income you have received from it.
Capital Loss
Canada The loss that results when a capital asset is sold for less than its purchase price.
Capital Stock
Canada All ownership shares of a company, both common and preferred.
Canada The total amount of all securities, including long-term debt, common and preferred stock, issued by a company.
Europe In saving and investment terms refers to a bank or building society deposit account in which your capital is secure.
Cash Equivalent
Canada Assets that can be quickly converted to cash. These include receivables, Treasury bills, short-term commercial paper and short-term municipal and corporate bonds and notes.
Cash Funds
Europe Alternative name for money market funds.
Cash Surrender Value
Canada The amount of cash a person may obtain by voluntarily surrendering a life insurance policy.
Cautious Managed Fund
Europe A type of fund which restricts its investment in equities to a maximum of 60% of the fund's holdings, in order to invest in other types of investments such as cash and bonds. This type of fund is considered to be more 'cautious' than funds which invest more of their holdings in equities, as more of their portfolios are diversified across less risky investments in cash and bonds.
Canada A document providing evidence of ownership of a security such as a stock or bond.
Certified Copy
Canada A copy or a photocopy of an original document bearing a stamp indicating it is a true copy of the original. If the original document is filed with a court or government agency, the certified copy must be certified by a clerk of the court or government agency where the original document is filed.
Closed-End Fund
USA A type of investment company that has a fixed number of shares, which are publicly traded. The price of a closed end fund's shares fluctuates based on investor supply and demand. Closed-end funds are not required to redeem shares and have managed portfolios.
Europe Unlike unit trusts and OEICs which are open-ended these are funds which only have a predetermined number of units/shares in issue at any time. The price of units/shares in such funds, which include Investment Trusts, will fluctuate according to investor demand rather than simply because of changes in the value of their underlying assets.
Asia A unit trust or mutual fund that has a fixed number of shares, usually listed on a major stock exchange.
Canada A fund company that issues a fixed number of shares. Its shares are not redeemable, but are bought and sold on stock exchanges or the over-the-counter market.
Collective Investment Schemes
Europe Funds which pool investors' money and invest on their behalr. This term refers to unit trusts and OEICs.
Commercial Paper
Canada A negotiable corporate promissory note with a term of a few days to a year. It is generally not secured by company assets.
USA A fee paid by an investor to a broker or other sales agent for investment advice and assistance.
Common Stock
Canada A security representing ownership of a corporation's assets. Voting rights are normally accorded to holders of common stock.
USA Earnings on an investment's earnings. Over time, compounding can produce significant growth in the value of an investment.
Europe The process by which your investment grows in value over time which reinvested interest or dividends.
Canada The process by which income is earned on income that has previously been earned. The end value of the investment includes both the original amount invested and the reinvested income.
Consumer Price Index
Canada A statistical device that measures the change in the cost of living for consumers. It is used to illustrate the extent that prices have risen or the amount of inflation that has taken place.
Contingent Deferred Sales Load (CDSL)
USA A fee imposed when shares are redeemed (sold back to the fund) during the first few years of ownership.
Continuous Disclosure
Canada One of the securities regulations that require an issuer of securities to report regularly on its material affairs
Canada See Wire order contract.
Contractual Plan
Canada An arrangement whereby an investor contracts to purchase a given amount of a security by a certain date and agrees to make partial payments at specified intervals.
Asia Regular investments made into a unit trust savings plan or the Mandatory Provident Fund Scheme.
Canada The addition of new (j.e., previously unregistered) money to a registered plan.
Canada The term used to identify the individual who makes contributions into a registered plan (with the exception of RESPs where this person is called a suscriber). See also Subscriber.
Canada A security that can be exchanged for another. Bonds or preferred shares are often convertible into common shares of the same company.
Corporate Bonds
Europe Fixed interest securities issued by public companies.
Corporate Resolution
Canada A legal document signed by the Board of Directors of a corporation that identifies the people with signing authority on behalf of the corporation for a mutual fund account.
Canada A legal business entity created under federal or provincial statutes. Because the corporation is a separate entity from its owners, shareholders have no legal liability for its debts.
Coupon Rate
Canada The annual interest rate of a bond.
Coverdell Education Savings Account (ESA)
USA This type of account, formerly known as an Education IRA, is a tax-advantaged trust or custodial account set up to pay the qualified education expenses of a designated beneficiary.
Creation price
Europe For dual-priced unit trusts this is the highest possible price at which an investor can buy units from the manager. The initial charge is not included. The creation price represents the cost of buying the fund's assets.
Credit Risk
USA The possibility that a bond issuer may not be able to pay interest and repay its debt.
Current Asset
Canada An asset that could be converted into cash within 12 months.
Current Liability
Canada A liability that has to be paid within 12 months.
Current Yield
Europe See running yield.
Canada The annual rate of return that an investor purchasing a security at its market price would realize. This is the annual income from a security divided by the current price of the security. It is also known as the return on investment.
USA An organization, usually a bank, that holds the securities and other assets of a mutual fund.
Europe Usually a major banking group, the custodian is appointed by the fund's trustee or depositary to safeguard the fund's assets.
Canada A financial institution, usually a bank or trust company, that holds a mutual fund's securities and cash in safekeeping.
Daily Valuation
Asia The calculation of the latest market value of a fund's underlying assets on each business day.
Canada A bond unsecured by any pledge of property. It is supported by the general credit of the issuing corporation.
Canada An obligation to repay a sum of principal, plus interest. In corporate terms, debt often refers to bonds or similar securities.

Canada A form of tax sheltering that results from an investment that offers deductions during the investor's high-income years, and/or postpones capital gains or other income until after retirement or during another period when the income level is expected to change.

Deferred Profit Sharing Plan
Canada A plan that allows an employer to set aside a portion of company profits from the benefit of employees. A corporation makes a contribution to the plan on behalf of an employee.
Defined Benefit Plan
Asia A retirement plan that promises to pay a certain amount, usually based on the number of years of service and on the average salary in the period before retirement. Employers generally bear all investment risks.
Europe A registered pension plan that guarantees a specific income at retirement, based on earnings and the number of years worked.
Defined Contribution Plan
Asia A retirement plan offering a benefit that depends on the total contributions made by the employer and the employee, and on the investment returns earned by those contributions. Employees generally bear the investment risk.
Europe A registered pension plan that does not promise an employee a specified benefit upon retirement. Benefits depend on the performance of investments made with contributions to the plan.
Canada The principal amount, or value at maturity, or a debt obligation. Also known as the par value or face value.
Deposit Account
Europe A bank or building society account which earns a steady rate of interest and in which your original capital is secure. The interest rates paid vary depending on the length of time you are prepared to lock your money away for.
Europe Responsible for overseeing the fund manager's activities in relation to an OEIC. Usually a large bank, the depositary must be independent of the fund manager. It acts in the interests of the investors, owning the investments in the fund on their behalf. It also ensures that the fund is invested according to its investment objectives and that the manager complies with the regulations. The unit trust equivalent is known as the trustee.
USA A decline in an investment's value.
Canada Charges made against earnings to write off the cost of a fixed asset over its estimated useful life. Depreciation does not represent a cash outlay. It is a bookkeeping entry representing the decline in value of an asset that is wearing out.
De-registration Fee
Canada See Termination fee.
Europe A general term for futures and options.
Direct Order
Canada An order for mutual funds that includes all documentation necessary to settle the trade when the order reaches the fund management company.
Canada The amount by which a bond sells on the secondary market at less than its par value or face value.
Discount Broker
Europe A service provided by an intermediary where no advice is taken. Also known as an 'execution only' service, the broker will buy a product on behalf of an investor after the investor has chosen which product they would like to purchase. Discount brokers usually waive or discount the initial charge, as no advice has been provided. This service is often available by post and rather than pay commission you are charged a one off transaction charge.
Canada A securities firm that offers services at a reduced rate. Typically a discount broker offers trading services but no research services.
USA 1) The payment of dividends and capital gains, or 2) a term used to describe a method of selling to the public.
Europe Income paid out from a unit trust or OEIC in the form of interest or dividends.
Canada Payments to investors by a mutual fund from income or from profit realized from sales of securities.
Canada Any financial firm with the authority to sell mutual fund units to the public. This can include brokers, dealers, banks, and mutual fund management companies (if they are registered as dealers).
USA The practice of investing broadly across a number of securities to reduce risk, and a key benefit of investing in mutual funds and other investment companies.
Europe A term used to describe the spreading of risk by investing in a number of different companies and assets. Doing so will mean that you won't have all of your eggs in one basket.
Asia The process of which a fund and its management company is subject to when a potential investor tries to evaluate a fund for investment. This normally involves one or more interviews with the fund manager, understanding the investment strategy and process undertaken by the fund, and a complete review of the offering documentations and the fund structure.
Canada The investment in a number of different securities. This reduces the risks inherent in investing. Diversification may be among types of securities, companies, industries or geographic locations.
Europe Income paid on shares out of company profits.
Canada A per-share payment designated by a company's board of directors to be distributed among shareholders. For preferred shares, it is generally a fixed amount. For common shares, the dividend varies with the fortunes of the company and the amount of cash on hand. It may be omitted if business is poor or the directors withhold earnings to invest in plant and equipment.
Dividend Distributions
Europe Income paid out by unit trusts and OEICs that invest mainly in equities.
Asia Payments to unit trust holders of gains realized during the year on securities that the fund has sold at a profit, minus any realized losses.
Dividend Fund
Canada A mutual fund that invests in common shares of senior Canadian corporations with a history of regular dividend payments at above average rates, as well as preferred shares.
Dividend Tax Credit
Canada An income tax credit available to investors who earn dividend income through investments in the shares of Canadian Corporations.
Dollar-cost Averaging
USA The practice of investing a fixed amount of money at regular intervals, regardless of whether the securities markets are declining or rising.
Europe See also Pound Cost Averaging
Asia Investing equal amounts of money at regular intervals over time. This technique ensures that an investor buys fewer shares when prices are high and more shares when prices are low. Historically, this has proven to reduce the overall cost of the investment.
Canada A principle of investing which entails the use of equal amounts for investment at regular intervals in the hope of reducing average share cost by acquiring more shares in periods of lower securities prices and fewer shares in periods of higher securities prices.
Canada See Deferred Profit Sharing Plan.
Dual Pricing
Europe Dual-priced funds have an offer price at which you buy, and a lower bid price, at which you sell. The difference between the two prices is known as the bid/offer spread. The buying price is normally higher than the selling price as this includes the initial charge to be paid to the fund manager
Earned Income
Canada For tax purposes, earned income is generally the money made by an individual from employment. It also includes some taxable benefits. Earned income is used as the basis for calculating RRSP maximum contribution limits.
Earnings Statement
Canada A financial statement showing the income and expenses of a business over a period of time. Also known as an income statement or profit and loss statement.
Education Ira
USA See Coverdell ESA.
Emerging Markets Fund
Asia A unit trust that invests primarily in developing markets in Asia, Latin America, or Eastern Europe. Considered as a higher risk investment in view of size, liquidity, and development cycle of these markets.
Employee Contribution
Asia An employee's own investment into the company's MPF or retirement plan.
Employer Contribution
Asia The amount an employer contributes to the employee's MPF or retirement plan.
Canada The net worth of a company. This represents the ownership interest of the shareholders (common and preferred) of a company. For this reason, shares are often known as equities.
Equity Fund
USA See Stock Fund.
Europe Shares in a company (see also stocks and shares).
Asia A unit trust that invests in local and/or overseas stocks. The objective is primarily to seek capital growth.
Canada A mutual fund whose portfolio consists primarily of common stocks.
Equity Exposure
Europe Usually expressed in percentage form. This illustrates the proportion of a fund which is invested in stocks and shares (equities).
Ethical Funds
Europe Also known as Socially Responsible Investments (SRIs). These funds aim to avoid investing in activities which may be harmful to society, such as tobacco production or child labour. Some funds also aim to actively invest in companies which promote ethical policies such as recycling.
Exchange Privilge
USA A fund option enabling shareholders to transfer their investments from one fund to another within the same fund family as their needs or objectives change. Typically, fund companies allow exchanges several times a year for a low or no fee.
Exchange-Traded Fund (ETF)
USA An investment company, typically a mutual fund or unit investment trust, whose shares are traded intraday on stock exchanges at market determined prices. Investors may buy or sell ETF shares through a broker just as they would the shares of any publicly traded company.
Ex-Dividend Date
USA With regard to mutual funds, this is the day on which declared distributions (dividends or capital gains) are deducted from the fund's assets before it calculates its net asset value (NAV). The NAV per share will drop by the amount of the distribution per share.
Europe For funds, the period between its accounting date and when it pays out its income. If you buy a unit trust in this period, you do not get the income, but if you sell, you do.
Exempt Funds
Europe Refers to funds that are only open to institutional investors which are exempt from paying capital gains tax, such as pension funds and charities.
Exit Charge
Europe Also know as redemption charge. A charge taken by the managers of some funds when you sell units. In many cases, the charge will only be applied if you sell within, say, five years. Exit charges are usually applied instead of, rather than in addition to, an initial charge.
Expected Income Yield
Europe An estimate of the income that you might earn in the coming year if you bought units at the current price.
Expenses Charged to Capital
Europe Expenses incurred by the fund can either be taken out of the income received by the fund or from the fund's capital. Charging expenses to capital will increase the amount that can be paid out to investors as distributions but will reduce the capital value of the fund.
Expense Ratio
USA A fund's cost of doing business-disclosed in the prospectus- expressed as a percentage of its assets.
Face Value
USA The amount that a bond's issuer must repay at the bond's maturity date.
Canada The principal amount, or value at maturity, of a debt obligation. Also known as the par value or denomination.
Fact Find
Europe A process undertaken by independent financial advisers (IFAs) to establish the financial position, investment goals and attitude to risk of their clients to ensure that suitable advice is given.
Fair Market Value
Canada The price a willing buyer would pay a willing seller if neither was under any compulsion to buy or sell. The standard at which property is valued for a deemed disposition.
Fair Value Pricing
Europe This is the manager's best estimate of the value of one or more securities at the valuation point of the fund, with the intention of producing a 'fairer' dealing price, where there is doubt over the validity of those prices.
Family of Funds
USA A group of mutual funds, each typically with its own investment objective, managed and distributed by the same company.
Canada An individual or institution occupying a position of trust. An executor, administrator or trustee. Hence, 'fiduciary' duties.
Fiscal Policy
Canada The policy pursued by government to manage the economy through its spending and taxation powers.
Fixed Assets
Canada Assets of a long-term nature, such as land and buildings.
Fixed Dollar Withdrawal Plan
Canada A plan that provides the mutual fund investor with fixed-dollar payments at specified intervals, usually monthly or quarterly.
Fixed-income Fund
Asia A unit trust that seeks current income by investing in fixed-income securities such as bonds.
Canada See Bond fund.
Fixed Income Investments
Canada Investments that generate a fixed amount of income that does not vary over the life of the investment.
Fixed Interest Securities
Europe Provide regular, fixed, interest payments and are issued by companies and Governments. They include gifts and bonds.
Fixed Liability
Canada Any corporate liability that will not mature within the following fiscal period. For example, long-term mortgages or outstanding bonds.
Fixed-period Withdrawal Plan
Canada A plan through which the mutual fund investor's holdings are fully depleted through regular withdrawals over a set period of time. A specific amount of capital, together with accrued income, is systematically exhausted.
529 Plan
USA An investment program, offered by state governments, designed to help pay future qualified education expenses. States offer two types of 529 plans: prepaid tuition programs allow contributors to establish an account in the name of a student to cover the cost of a specified number of academic periods or course units in the future at current prices; college savings plans allow individuals to contribute to an investment account to pay for a student's qualified higher education expenses.
Canada A procedure that ensures fund's investors are not affected when a wire order fails to settle by settlement date. In the case of a failed purchase, it involves placing an offsetting redemption order for the units purchased. In the case of a failed redemption, it involves placing an offsetting purchase order for the units redeemed.
Foreign Content
Canada The amount of a registered plan that is invested in foreign securities.
Forward Pricing
USA The concept describing the price at which mutual fund shareholders buy or redeem fund shares. Shareholders buying or redeeming shares after 4 pm must receive the next computed share price following the fund's receipt of a shareholder transaction order.
Europe 'This is the most common method of pricing authorised funds. Once the manager has received your instruction to buy or sell units, the price of those units will be determined at the next valuation point of the fund. Free Standing Additional Voluntary Contribution (FSAVC) schemes. These permit people who are part of a company pension scheme to make additional contribution to separate stand-alone scheme that can continue when you change employer.'
Canada A method of determining the unit price of a mutual fund order based on the next valuation of the fund's assets.
401(k) Plan
USA An employer-sponsored retirement plan that enables employees to make tax-deferred contributions from their salaries to the plan.
Front-end Fee
Asia A sales commission charged at the time of purchase and paid to the distributors.
Front-end Load
Canada A sales charge levied on the purchase of mutual fund units.
Fund Manager
Europe Manages the unit trust in accordance with the fund's objectives and decides which assets to hold in order to meet those objectives. In an OEIC the manager is referred to as the Authorised Corporate Director (ACD).
Asia The person or persons responsible for making investment decisions of a unit trust or mutual fund.
Canada See Management company.
Fund Number
Canada A three-digit number used in the Canadian mutual fund industry to uniquely identify a fund for trading purposes.
Fund of Funds
Europe Fund of funds are designed to increase diveresification by investing in other funds.
Fund Supermarkets
Europe A one-stop location where investors can choose funds from a wide range of fund families.
Asia Companies which enable investors to buy, manage and sell their investments with different fund managers through a single account, usually online. Not to be confused with supermarkets such as Tesco which sell financial products.
Fundamental Analysis
Canada A method of evaluating the future prospects of a company by analyzing its financial statements. It may also involve interviewing the management of the company.
Europe Bonds issued by the UK Government. Also known as gilt edged securities. Along with bonds can be referred to as fixed interest securities.
Europe The amount a fund can 'gear' is the amount it can borrow in order to invest. In unit trusts and OEICs borrowing is limited to 10% of the fund's value and is usually for the purpose of managing cash flow rather than to increase the fund's investment exposure.
Global Fund
Asia A unit trust or mutual fund that invests in securities worldwide.
Canada A mutual fund that diversifies by investing in international markets.
Gross Income
Europe Dividends and interest paid out to you before income tax has been deducted.
Gross Redemption Yield
Europe Usually used in bond investments. This yield seeks to indicate the total return you might receive from both income and capital growth (or loss) if you hold your investment over a ten-year period.
Growth and Income Fund
Asia A wide range of investment funds that seeks to make investment gains that are not related to movements in the markets of the underlying securities in which the fund invests.
Growth Stocks
Canada Shares of companies whose earnings are expected to increase at an above-average rate. Growth stocks are often typified by their low yields and relatively high price/earnings rations. Their prices reflect investors' belief in their future earnings in growth.
Guaranteed fund
Europe This is where a fund manager promises to provide a specific minimum return, backed by a legally enforceable arrangement with a third party to guarantee that promise.
Guaranteed Investment Certificates
Canada A deposit instrument paying a predetermined rate of interest for a specified term, available from banks, trust companies and other financial institutions.
Half-Yearly Report
Europe Also known as the 'interim report'. It will include details of the fund's investments and how it has performed and more general financial information relating to the fund (see also Annual report). Your fund manager will send it to you during the financial year for the fund(s) that you hold.
Health Savings Account (HSA)
USA A plan that allows workers with high-deductible health insurance coverage to set aside money each year for routine or future health care costs.
Hedge Fund
USA A private investment pool for wealthy investors that, unlike a mutual fund, is exempt from SEC regulation.
Europe A fund, which uses an assortment of trading techniques and instruments to meet an objective of providing positive investment returns irrespective of the performance of stock markets.
Historic Pricing

Where the price at which you buy or sell your units/shares is calculated at the last valuation point i.e. the fund manager uses the price set before he received your instructions.

Hybrid Fund
USA A mutual fund that invests in a mix of equity and fixed-income securities.
Europe Investment Company with Variable Capital. Another term used to describe an OEIC. This term is used rarely but you may come across it in formal documents relating to an OEIC.
USA Dividends, interest, and/or short term capital gains paid to a mutual fund's shareholders. Income is earned on a fund's investment portfolio after deducting operating expenses.
Europe The return on your investment that arises from dividends and interest earned by the fund.
Income Fund
Asia A unit trust or mutual fund that seeks current income rather than capital growth, investing mainly in bonds.
Canada Mutual funds that invest primarily in fixed-income securities such as bonds, mortgages and preferred shares. Their primary objective is to produce income for investors, while preserving capital.
Income Statement
Canada A financial statement summarizing the revenue and expenses for a company during a financial period, such as a quarter or a year.
Income Units/Shares
Europe This type of unit/share pays out to you on set dates each year any interest or dividends your investment makes.
Indemnity Agreement
Canada An agreement to reimburse the party undertaking a responsibility for any damages or costs suffered as a result of that responsibility. Used for small estate accounts when the requirement to produce probate documents is waived.
Independent Director
USA An individual who cannot have any significant relationship with a mutual fund's adviser or underwriter, in order to better enable the fund board to provide an independent check on the fund's operations.
Independent Financial Adviser (IFA)
Europe An authorised and qualified professional who can advise on all financial services and products available and tailor them to your needs.
Index Fund
Asia A passively managed unit trust or mutual fund that seeks to mirror the performance of a particular market index.
Canada A mutual fund that matches its portfolio to that of a specific financial market index, with the objective of duplicating the general performance of the market in which it invests.
Europe A grouping of shares or fixed interest securities on the stock market which are often similar in size or represent similar industries. For example, the FTSE 100 index represents the largest 100 UK companies by market capitalisation
Index Tracking Funds
Europe Index tracking funds aim to mirror the progress of a stock market index, e.g. the FTSE 100, by buying and selling shares in the same proportions as represented on the index. These are also sometimes called tracker funds or index funds.
Index Mutual Fund
USA A fund designed to track the performance of a market index. The fund's portfolio of securities mirrors that of the designated market index.
Individual Retirement Account (IRA)
USA An investor-established, tax-deferred account set up to hold and invest funds until retirement.
Europe A general rise in the level of prices on the high street. This is measured by the retail price index.
Canada A condition of increasing prices. In Canada, inflation is generally measured by the Consumer Price Index.
Inflation Risk
USA The risk that a portion of an investment's return may be eliminated by inflation.
Initial Charge
Europe A charge that is paid to the fund manager when you invest to cover their expenses, such as commission, advertising, administration and dealing costs.
Initial Public Offering (IPO)
USA A corporation's or investment company's first offering of stock or fund shares to the public.
Canada A corporation's or investment company's first offering of stock or fund shares to the public.
Institutional Investor
Europe Institutions which invest, such as company pension schemes, as opposed to private individuals.
Canada A general term used to describe securities.
Instrument of Incorporation
Europe This document forms the legal constitution for an OEIC fund and dictates much of how the fund will operate. The unit trust equivalent is known as the Trust Deed.
Europe An amount, in percentage form, which a bank or building society will credit to you if you save with it in a deposit/savings account. The amount paid to you will be a percentage of whatever capital you have in your account. Gilts and bonds also pay income in the form of interest.
Canada Payments made by a borrower to a lender for the use of the lender's money. A corporation pays interest on bonds to its bondholders.
Interest Distributions
Europe Income paid out by unit trusts and OEICs that invest predominantly in gilts and bonds.
Interest Rate Risk
USA The possibility that a bond's or bond mutual fund's value will decrease due to rising interest rates.
Europe When buying a financial product you may not want to buy from the fund management company directly but go to a third party who may be able to offer you advice or a discount. These third parties are known as intermediaries and include banks, building societies and independent financial advisers.
Interim Report
Canada A report issued at least semi-annually to keep investors updated on the fund's financial position and operations. The financial statements included in these reports are unaudited.
International Fund
Canada A mutual fund that invests in securities of a number of countries.
Canada The legal term for a person who dies without leaving a will.
Intrinsic Value
Canada The amount by which the price of a warrant or call option exceeds the price at which the warrant or option may be exercised.
Investment Adviser
USA An organization employed by a mutual fund to give professional advice on the fund's investments and asset management practices.
Asia A person or organization that makes the day-to-day decisions regarding a portfolio's investments, either on behalf of a unit trust or mutual fund (fund manager) or individuals (intermediary).
Canada Investment counsel to a mutual fund. Also may be the manager of a mutual fund.
Investment Company
USA A corporation, trust, or partnership that invests pooled shareholder dollars in securities appropriate to the organization's objective. Mutual funds, closed-end funds, unit investment trusts, and exchange-traded funds are the main types of registered investment companies.
Canada A corporation or trust whose primary purpose is to invest the funds of its shareholders.
Investment Counsel
Canada A securities firm.
Investment Fund
Canada A term generally interchangeable with 'mutual fund.'
Investment Objective
USA The goal (e.g., current income, long-term capital growth, etc.) that a mutual fund pursues on behalf of its investors.
Investment Funds
Europe A general term for unit trusts and OEICs.
Investment Trusts
Europe Similar to unit trusts in that they provide a means of pooling your investment but with a different structure and governed by different regulations. They are closed ended funds and public listed companies whose shares are traded on a Stock Exchange.
Issued Shares
Canada The number of securities of a company outstanding. This may be equal to or less than the number of shares a company is authorized to issue.
USA The company, municipality, or government agency that issues securities, such as stocks, bonds, or money market instruments.
Key Features Document
Europe This document must be offered to an investor before or at the point of purchase. It summarises key information about the fund and is less detailed than the prospectus. It provides additional information to the prospectus such as information on risk and an illustration of the effects of charges both to the investor and the fund
KYC Rule (Know Your Client)
Canada A standard form in the investment industry that ensures investment advisors know detailed information about their clients' risk tolerance, investment knowledge and financial position.
Letter of Direction
Canada A letter, usually from an estate executor or administrator, directing the fund managemetn company to transfer or redeem units of a mutual fund account.
Letter of Indemnity
Canada See Indemnity agreement.
Letter of Intent
Canada An agreement whereby an investor agrees to make a series of purchases of mutual fund units.
Letters of Administration
Canada Legal document appointing an administrator if the deceased had no will. May also be used to give court approval to a will, and authorize the appointment of the administrator if there is a will but no executor is named and able to act. Now called a Certificate of Appointment of Estate Trustee Without a Will in Ontario.
Letters probate
Canada A legal document issued in common law provinces (all provinces except Quebec) that verifies the authenticity of a will and the appointment of the executor. Now called a Certificate of Appointment of Estate Trustee with a Will in Ontario.
Canada The financial advantage of an investment that controls property of greater value than the cash invested. Leverage is usually achieved through the use of borrowed money.
Canada All debts or amounts owing by a company in the form of accounts payable, loans, mortgages and long-term debts.
Canada See Life Income Fund.
Life Annuity
Canada An annuity under which payments are guaranteed for the life of the annuitant.
Lifecycle Fund
USA Hybrid funds that follow a predetermined reallocation of risk over time to a specified target date, and typically rebalance their portfolios to become more conservative and income-producing by the target date.
Life Expentancy Adjusted Withdrawal Plan
Canada A plan through which a mutual fund investor's holdings are fully depleted while providing maximum periodic income over the investor's lifetime.
Life Income Fund
Canada Registered plan that shelters pension money and investment earnings from tax on a locked-in basis while generating income for the fundholder.
Life Insurance Products
Europe Products which guarantee that a sum of money will be paid out to you after a set term or upon death.
Lifestyle fund
USA Hybrid funds that maintain a predetermined risk level and generally use words such as 'conservative,' 'moderate,' or 'aggressive' in their names to indicate the fund's risk level.
Limited Redemption Funds
Europe Funds which restrict when you can cash in your investment, usually by only having set redemption dates.
USA The ability to gain ready access to invested money. Mutual funds are liquid because their shares can be redeemed for current value (which may be more or less than the original cost) on any business day.
Canada Refers to the ease with which an investment may be converted to cash at a reasonable price.
USA See Sales Charge.
Canada Commissions charged to holders of mutual fund units. (See sales charge.)
Load Fund
USA A fund that imposes a one-time fee-either when fund shares are purchased (front-end load) or redeemed (back-end load)-or a fund that charges a 12b-1 fee greater than 0.25 percent.
Locked-In Retirement Savings Plan (LRSP)
Canada A retirement savings plan to usually hold amounts transferred from an employer's pension fund. There are various investment options and a tax deferral on investment income and gains. Available to individuals to and including 69 years of age, the assets cannot be withdrawn before the end of the year in which the holder turns 69 years of age.
Long-term Debt
Canada Debt that becomes due after more than one year.
Long-Term Funds
USA A mutual fund industry designation for all funds other than money market funds. Long-term funds are broadly divided into equity (stock), bond, and hybrid funds.
Canada A mutual fund that charges a commission to purchase its shares.
Canada See Locked-In Retirement Savings Plan.
Management Company
Canada The entity within a mutual fund complex responsible for the investment of the fund's portfolio and/or the administration of the fund. It is compensated on a percentage of the fund's total assets.
Management Expense Ratio (MER)
Canada A measure of the total costs of operating a fund as a percentage of average total assets.
Management Fee
USA The amount paid by a mutual fund to the investment adviser for its services.
Asia The amount a unit trust or mutual fund pays to its fund manager for the work of overseeing the fund's holdings. Normally charged daily to the fund and reflected in the fund's net asset value.
Canada The sum paid to the investment company's adviser or manager for supervising its portfolio and administering its operations.
Europe See fund manager.
Manager's Report
Europe See Annual report and Half-yearly report.
Mandatory Contributions
Asia Investments made by the employer and employee to a MPF or retirement plan as required by the government. Employer and employee each has to contribute a maximum of 5% relevant income into fund(s) of the employee's choice.
Mandatory Provident Fund Scheme (MPF)
Asia A retirement scheme for employees required by the HKSAR government.


An investor's equity in the securities in his or her account. The margin purchaser puts up a portion of the value of the securities, borrowing the remainder from the investment dealer.
Marginal Tax Rate
Canada The rate of tax on the last dollar of taxable income.
Market Capitalisation
Europe The value of a company obtained by multiplying the number of its issued shares by their market price.
Market Index
Canada A vehicle used to denote trends in securities markets. The most popular in Canada is the Toronto Stock Exchange 300 Composite Index (TSE 300).
Market Price
Canada In the case of a security, market price is usually considered the last reported price at which the stock or bond is sold.
Market Risk
Europe Investing in the stock market means that you can benefit from its growth potential. However, there is also a risk (market risk) that you could lose your money should the stock market in which you have invested fall in value.
Market Value
Canada The current value of an asset if it were sold on the open market.
Mass Settlement
Canada A process where a mutual fund allows a distributor to settle its wire order purchases with one cheque.
Material change
Canada A change in the affairs of a company that may have an impact on the market value of its securities.
USA The date by which an issuer promises to repay a bond's face value.
Canada The date at which a loan or bond or debenture comes due and must be redeemed or paid off.
Money Market
Canada A sector of the capital market where short term obligations such as Treasury bills, commercial paper and bankers' acceptances are bought and sold.
Money Market fund
USA A mutual fund that invests in short-term, high-grade fixed-income securities, and seeks the highest level of income consistent with preservation of capital (i.e., maintaining a stable share price).
Europe These invest in cash investments, such as bank deposits. Often referred to as 'cash funds', they offer higher returns than a building society account but still have the same level of security.
Canada A type of mutual fund that invests primarily in treasury bills and other low-risk, short-term investments.
Money Purchase Pension Plan
Canada Another term for defined contribution pension plan.
Mortgage Fund
Canada A mutual fund that invests in mortgages. Portfolios of mortgage funds usually consist of first mortgages on Canadian residential property, although some funds also invest in commercial mortgages.
Mortgage-backed Securities
Canada Certificates that represent ownership in a pool of mortgages. The holders of these securities receive regular payments of principal and interest.
Mutual fund
USA An investment company that buys a portfolio of securities selected by a professional investment adviser to meet a specified financial goal (investment objective). Investors buy shares in a fund, which represent ownership in all the fund's securities. A mutual fund stands ready to buy back its shares at their current net asset value (NAV), which is the total market value of the fund's investment portfolio, minus its liabilities, divided by the number of shares outstanding. Most mutual funds continuously offer new shares to investors.
Asia An investment company that pools the money of like-minded investors and invests it in a variety of securities with a specific objective. Also known as unit trust.
Canada An investment entity that pools shareholder or unit holder funds and invests in various securities. The units or shares are redeemable by the fund on demand by the investor. The value of the underlying assets of the fund influences the current price of units.
Multimanager funds
Europe Multimanager funds are designed to increase diversification by a Manager of Managers outsourcing a pool of money for investment to appointed managers.
Multi-tied Adviser
Europe A type of financial adviser who can only sell you products from a limited number of financial institutions rather than an independent financial adviser who can choose from all products on the market.
Net Asset Value (NAV)
USA The per-share value of a mutual fund, found by subtracting the fund's liabilities from its assets and dividing by the number of shares outstanding. Mutual funds calculate their NAVs at least once daily.
Asia The market value of a unit trust or mutual fund's total assets, minus liabilities, divided by the number of units or shares outstanding. The value of a single share is called its unit or share price.
Canada The value of all the holdings of a mutual fund, less the fund's liabilities.
Net Asset Value per Share
Canada Net asset value of a mutual fund divided by the number of shares or units outstanding. This represents the base value of a share of unit of a fund and is commonly abbreviated to NAVPS.
Net Income
Europe Dividends and interest paid out to you after income tax has been deducted
Net New Cash Flow
USA The dollar value of new sales minus redemptions, plus net exchanges. A positive number indicates new sales plus exchanges into funds exceeded redemptions plus exchanges out of funds. A negative number indicates redemptions plus exchanges out of funds exceeded new sales plus exchanges into funds.
No-Load Fund
USA A mutual fund whose shares are sold without a sales commission and without a Rule 12b-1 fee of more than 0.25 percent per year.
Canada A mutual fund that does not charge a fee for buying or selling its shares.
Canada The company (such as a distributor) or person in whose name fund units are registered on behalf of the beneficial owner.
Non-financial Transactions
Canada A transaction that does not affect the financial status of an account, such as a change of address or a change of salesperson.
Non-Investment Grade Bonds
Europe These bonds have a high risk of the company that issued the bonds being unable to repay them. They are lower rated bonds on the share index, with a poor credit rating often as low as D. They are sometimes referred to as 'junk bonds'.
Notarial Copy
Canada A copy or photocopy of an original document to which a notarial certificate is attached stating that the copy is a true copy of the original.
Notarial Will
Canada A form of will used in Quebec that does not require Letters Probate or Letters of Administration. A notarial will must be written and signed in the presence of two notaries or in the presence of a notary and two witnesses.
Notary Public
Canada A person, such as a lawyer, who is legally authorized to draw up and attest to the validity of wills and contracts.
Odd Lot
Canada Any number of securities that represents less than a board lot.
Europe Open ended investment companies. These are very similar to unit trusts, but are constituted as companies rather than trusts. They are the established structure in many other European countries and are usually single priced.
Offer Price
Europe Some unit trusts have separate prices for buying and selling units. The offer price is the one at which you buy units and is usually higher than the bid price as it includes an initial charge.
Asia The sales price of a fund which equals the net asset value plus a front end fee, if any.
Offshore Fund
Asia A unit trust or mutual fund which is domiciled outside the country where it is offered for sale.
Open-Ended Fund
Europe Funds such as unit trusts and OEICs which expand and contract by issuing or cancelling units/shares depending upon demand.
Asia A unit trust or mutual fund that has an unlimited number of shares available for purchase.
Canada An open-end mutual fund continuously issues and redeems units, so the number of units outstanding varies from day to day. Most mutual funds are open-ended.
Open-End Investment Company
USA The legal name for a mutual fund, indicating that it stands ready to redeem (buy back) its shares from investors.
Open Plans
Canada See Investment plans.
Europe Provide the opportunity (a 'right' rather than an obligation) for the buyer to purchase or sell a certain number of shares, at a future date and a known price.
Canada The right or obligation to buy or sell a specific quantity of a security at a specific price within a stipulated period of time.
Operating Expenses
USA Business costs paid from a fund's assets before earnings are distributed to shareholders. These include management fees, 12b-1 fees, and other expenses.
Canada A request from a client to purchase, redeem, switch, or transfer mutual fund units.
Outstanding Shares
Canada The number of shares (or units) issued by a mutual fund and held by its investors.
Over-the-Counter Market
Canada A securities market that exists for securities not listed on stock exchanges. Bonds, money market securities and many stocks are traded on the over-the-counter market.
Canada See Power of attorney.
Par Value
Canada The principal amount, or value at maturity, of a debt obligation. It is also known as the denomination or face value. Preferred shares may also have par value, which indicates the value of assets each share would be entitled to if a company were liquidated.
Passive Managed Fund
Europe Passive managed funds aim to mirror the progress of a stock market index, e.g. the FTSE 100, by buying and selling shares in the same proportions as represented on the index. These are also sometimes called tracker funds or index (tracker) funds.
Payroll Deduction Plan
USA An arrangement that some employers offer employees to accumulate mutual fund shares. Employees authorize their employer to deduct a specified amount from their salaries at stated times and transfer the proceeds to the fund.
Canada An arrangement that some employers offer employees to accumulate mutual fund shares. Employees authorize their employer to deduct a specified amount from their salaries at stated times and transfer the proceeds to the fund.
Pension Adjustment
Canada An amount that reduces the allowable contribution limit to an RRSP based on the benefits earned from the employee's pension plan or deferred profit sharing plan.
Pension Plan
Asia A retirement plan that holds investments of a company's employees for the purpose of providing retirement benefits when the employee retires or leaves the company.
Canada A formal arrangement through which the employer, and in most cases the employee, contribute to a fund to provide the employee with a lifetime income after retirement.
Permanent Life Insurance
Canada Life insurance coverage for which the policyholder pays an annual premium, generally for the life of the insured. This type of policy features a savings component, known as the cash surrender value.
USA The basic concept behind mutual funds in which a fund aggregates the assets of investors who share common financial goals. A fund uses the investment pool to buy a diversified portfolio of investments, and each mutual fund share purchased represents ownership in all the fund's underlying securities.
USA A collection of securities owned by an individual or an institution (such as a mutual fund) that may include stocks, bonds, money market instruments, and other securities.
Europe Refers to investment holdings. It can either refer to the holdings within a particular fund or the range of investments held by an individual investor.
Asia All the securities held by a unit trust or mutual fund or the total investment holdings of an individual or an institution.
Canada All the securities which an investment company or an individual investor owns.
Portfolio Manager
USA A specialist employed by a mutual fund's adviser to invest the fund's assets in accordance with predetermined investment objectives.
Portfolio Turnover
USA A measure of the trading activity in a fund's investment portfolio-how often securities are bought and sold by a fund.
Pound cost Averaging
Europe Investing on a regular basis can iron out stock market fluctuations and can help you to avoid investing all of your money when the market is at its peak. Saving regularly enables you to buy more shares when the market and prices are low and less when the market and prices are high. Over time the cost of your units will even out and it is likely that you will end up paying below average prices for your units. This is known as pound cost averaging.
Preference Shares
Europe These are similar to bonds in that they usually pay a fixed rate of income. However, they pay it as a dividend rather than interest and are subject to the issuing company making sufficient profits.
Preferred Share
Canada An ownership security, senior to the common stock of a corporation, with preferred claim on assets in case of liquidation and a specified annual dividend.
Canada The amount by which a bond's selling price exceeds its face value. Also, the amounts paid to keep an insurance policy in force.
Prepayment Risk
USA The possibility that a bond owner will receive his or her principal investment back from the issuer prior to the bond's maturity date.
Present Value
Canada The current worth of an amount to be received in the future. In the case of an annuity, present value is the current worth of a series of equal payments to be made in the future.
Canada The net asset value per share or unit of a mutual fund on a given day.
Price Earnings Ratio
Canada The market price of a common share divided by its earnings per share for 12 months.
Primary Distribution
Canada A new security issue, or one that is made available to investors for the first time.
USA See Face Value.
Canada The person for whom a broker executes an order, or a dealer buying or selling for his or her own account. Also, an individual's capital or the face amount of a bond.
Professional Management
USA The full-time, experienced team of professionals that decides what securities to buy, hold, and sell for a mutual fund portfolio.
USA The official document that describes a mutual fund to prospective investors. The prospectus contains information required by the U.S. Securities and Exchange Commission (SEC), such as investment objectives and policies, risks, services, and fees.
Europe Offered to an investor before the point of purchasing units/shares. This document formally sets out further detail on aspects covered in the instrument of incorporation or trust deed such as charges, distribution dates and investment policy but in a less legalistic way. For unit trusts it is sometimes known as the Scheme Particulars.
Asia A legal document that gives prospective investors information about an investment, including its investment objectives and policies, risks, costs, and past performance. Before investing in a unit trust or mutual fund one should read the prospectus.
Canada The document by which a corporation or other legal entity offers a new issue of securities to the public.
Protected Funds
Europe Funds other than money market (cash) funds which aim to provide a return of a minimum amount of capital back to the investor, with the potential for some growth. Unlike guaranteed funds, they do not back their promise with a guarantee.
Europe A financial company, in the case of unit trusts and OEICs a fund management company, which provides financial products to members of the public
Canada The act of buying mutual fund units by an investor.
USA The creditworthiness of a bond issuer, which indicates the likelihood that it will be able to repay its debt.
Rate of Return
Canada The return on an investment expressed as a percentage of the amount invested.
Ratio Withdrawal Plan
Canada A type of mutual fund withdrawal plan that provides investors with an income based on a percentage of the value of units held
Real Estate Fund
Canada A mutual fund that invests primarily in residential and/or commercial real estate to produce income and capital gains for its unitholders.
Real Estate Investment Trust
Canada A closed-end investment company that specializes in real estate or mortgage investments.
Record Date
Canada The date on which the list of investors is fixed for the purpose of paying a distribution or dividend.
USA To cash in mutual fund shares by selling them back to the fund. Mutual fund shares may be redeemed on any business day. An investor receives the current share price, called net asset value (NAV), minus any deferred sales charge or redemption fee.
Canada Preferred shares or bonds that giver the issuing corporation an option to repurchase securities at a stated price. These are also known as callable securities.
Asia The sale of a unit trust or mutual fund.
Canada The sale of mutual fund units back to the fund by an investor.
Redemption Charge
Europe See Exit charge.
Redemption Date
Europe Usually associated with gilts or bonds, the redemption date is the date set in advance when the gilt or bond will be repaid by the issuing government or company and you will receive your capital back.
Redemption Fee
Asia A sales fee charged by some unit trusts or mutual funds when an investor sells his/her investments in the fund.
Redemption Price/Bid Price
Asia The price at which a unit trust or mutual fund's shares are redeemed, or bought back, by the fund, determined by deducting a redemption fee from the net asset value (NAV) per unit or share.
Redemption Price
USA The amount per share that mutual fund shareholders receive when they cash in shares. The value of a fund's shares on any given day depends on the current market value of its underlying investment portfolio at that time.
Asia Is the price at which open-ended schemes repurchase their units and close-ended schemes redeem their units on maturity. Such prices are NAV related.
Redemption Yield
Europe See Gross redeption yield.
Regional Fund
Asia A unit trust or mutual fund that invests in securities of a particular region such as Europe, Asia etc.
Registered Education Savings Plan (RESP)
Canada A plan that enables a contributor, on a tax deferral basis, to accumulate assets on behalf of a beneficiary to pay for a post secondary education.
Registered Owner
Canada The person or company whose name is shown in the Register of Owners for the mutual fund. However, the registered owner may not be the ultimate (or beneficial owner) of the fund units, as in the case of nominee accounts.
Retistered Pension Plan (RPP)
Canada A plan registered with Revenue Canada and established by an employer to provide retirement benefits to its employees.
Registered Plans
Canada Plans that are registered with Revenue Canada and allow investors to defer paying taxes on contributions and the income earned in the plans.
Registered Retirement Income Fund (RRIF)
Canada A maturity option available for RRSP assets to provide a stream of income at retirement.
Registered Retirement Savings Plan (RRSP)
Canada A retirement savings plan to hold amounts deducted from taxable income, within certain limits, in a tax deferred state. There are various investment options and a tax deferral on investment income and gains. Available to individuals to and including 69 years of age, but must be collapsed by the end of the year in which the holder turns 69 years of age.
Asia Use of dividend distribution to buy additional securities. Many unit trust or mutual fund offer the automatic dividend reinvestment option to unitholders.
Reinvestment Privilege
USA An option whereby mutual fund dividend and capital gain distributions automatically buy new fund shares.
Europe The sale of units back to the fund manager to realise/cash in the investment. It is also referred to as redemption, although not to be confused with the redemption of a gilt or bond.
Asia Is the price at which a close-ended scheme repurchases its units and it may include a back-end load. This is also called Bid Price.
Retail Investor
Europe Term referreing to members of the general investing public.
Retained Earnings
Canada The accumulated profits of a company. These may or may not be reinvested in the business.
Canada Bonds or preferred shares that allow the holder to require the issuer to redeem the security before the maturity date.
Europe The amount of income, capital growth or both that is generated by your investment.
Canada Options granted to shareholders to purchase additional shares directly from the company concerned. Rights are issued to shareholders in proportion to the securities they may hold in a company.
Rights of Rescission
Canada The right of an investor to rescind or cancel (called the right of rescission) within 48 hours after receipt of confirmation of a purchase of $50,000 or less.
Rights of Withdrawal
Canada The right to withdraw from an order within two business days of receipt of a prospectus.
Canada The possibility of loss; the uncertainty of future returns.
Risk Profile
Canada This relates to how much risk you are prepared to take with your money. Generally the more risk you take, the higher the potential gain but the more likely it is that you could lose some or all of your capital. Your risk profile may depend on your financial circumstances, as some people are able to take more risk than others. If you are unsure of your risk profile you should contact an independent financial adviser for assistance before making an investment.
Risk-adjusted Return
Asia A measure of how much risk a fund takes to make its returns. Usually given as a number or a rating. The more return per unit of risk, the better.
Risk/Reward Tradeoff
USA The principle that an investment must offer higher potential returns as compensation for the likelihood of increased volatility.
Risk Tolerance
Asia An investor's ability to endure declines in the prices of investments while waiting for them to increase in value.
USA The shifting of an investor's assets from one qualified retirement plan to another-due to changing jobs, for instance- without a tax penalty.
Canada See Registered Pension Plan.
Canada See Registered representative.
Canada See Registered Retirement Income Fund.
Canada See Registered Retirement Savings Plan.
Running Yield
Europe Also known as income yield. The amount of income generated by a bond or gilt fund at the current time.
Sales Charge
USA An amount charged for the sale of some fund shares, usually those sold by brokers or other sales professionals. By regulation, a mutual fund sales charge may not exceed 8.5 percent of an investment purchase. The charge may vary depending on the amount invested and the fund chosen. A sales charge or load is refl ected in the asked or offering price. See Asked or Offering Price.
Asia Is the price you pay when you invest in a scheme. Also called Offer Price. It may include a sales load.
Canada In the case of mutual funds, these are commissions charged to holder of fund units, usually based on the purchase or redemption price. Sales charges are also known as 'loads.'
Sales Load
Asia Is a charge collected by a scheme when it sells the units. Also called, 'Front-end' load. Schemes that do not charge a load are called 'No Load' schemes.
Secondary Market
USA Markets where certain investment company shares (closed-end, UIT, and ETF) are bought and sold subsequent to their initial issuance.
Europe Unit trusts and OEICs are divided into a variety of categories, known as sectors, to keep together funds of a similar type so that investors can compare funds with similar objectives and investment strategies. Categories include 'Money market' funds, 'European' funds, 'North American' funds etc.
Sector/Theme fund
Asia A unit trust or mutual fund that concentrates on a relatively narrow market sector, such as technology or healthcare funds. These funds can experience higher share-price volatility than some diversified funds because sector funds are subject to issues specific to a given sector.
Europe Another name for documented investments such as stocks, shares and bonds.
Securities Act
Canada Provincial legislation regulating the underwriting, distribution and sale of securities.
Series Fund
USA A group of different mutual funds, each with its own investment objective and policies, that is structured as a single corporation or business trust.
Share Classes (e.g., Class A, Class B, etc.)
USA Distinct groups of fund share offerings representing ownership in the same fund while offering different fee charges. This feature of fund ownership enables shareholders to choose the type of fee structure that best suits their particular needs.
USA An investor who owns shares of a mutual fund or other company.
Shareholders' Equity
Canada The amount of a corporation's assets belonging to its shareholders (both common and preferred) after allowance for any prior claim.
Europe The name given to a part of a company owned by an investor - the investor buys shares in the company. Is also used to describe the OEIC equivalent of a unit.
Asia A unit of ownership in a mutual fund.
Canada A document signifying part ownership in a company. The terms 'share' and 'stock' are often used interchangeably.
Short Selling
Canada The sale of a security made by an investor who does not own the security. The short sale is made in expectation of a decline in the price of a security, which would allow the investor to then purchase the shares at a lower price in order to deliver the securities earlier sold short.
Short-Term Funds
USA Another term for money market funds.
Simplified Employee Pension Plan (SEP)
USA A retirement program consisting of individual retirement accounts for all eligible employees, to which the employer can contribute according to certain rules. A fairly simple, inexpensive plan to establish and administer, a SEP can be attractive to small businesses and selfemployed individuals.
Simplified Prospectus
Canada An abbreviated and simplified prospectus distributed by mutual funds to purchasers and potential purchasers of units or shares (see prospectus).
Simple Ira
USA The Savings Incentive Match Plan for Employees, or SIMPLE, IRA, created in 1996, is a tax-favored retirement plan that small employers can set up for the benefit of their employees.
Single Pricing
Europe OEICs and some unit trusts have a single price at which investors both buy and sell. The initial charge is shown separately and is charged in addition to the unit/share price.
Socially Responsible Investment Funds
Europe See Ethical funds.
Specialty Fund
Canada A mutual fund that concentrates its investments on a specific industrial or economic sector or a defined geographical area.
Canada The difference between the rates at which money is deposited in a financial institution and the higher rates at which the money is lent out. Also, the difference between the bid and ask price for a security.
Standard & Poor's 500 Index (S&P 500)
USA A daily measure of stock market performance, based on the performance of 500 major companies.
Statement of Additional Information (SAI)
USA The supplementary document to a prospectus that contains more detailed information about a mutual fund; also known as 'Part B' of the prospectus. STOCK - A share of ownership or equity in a corporation.
Statement of changes in net assets
Canada This financial statement shows the increase or decrease in the value of the fund's portfolio for the period stated. It also shows the dollar value of investor purchases and redemption.
Statement of investment portfolio
Canada A financial statement that shows the details of a fund's investment portfolio. It lists the quantity of each security held, the average cost, the current market value, and the percentage each security represents of the fund's total investment portfolio.
Statement of portfolio transactions
Canada A financial statement that shows the purchase and sale of the securities in the fund's portfolio. It is available on request from the fund management company.
Canada A securities firm or employee who acts as an agent to buy and sell securities on behalf of a client. There is a fee or commission for this service.
Stock Fund
USA A mutual fund that concentrates its investments in stocks.
Stock Options
Canada Rights to purchase a corporation's stock at a specified price.
Stocks and Shares
Europe Also known as equities, this is the name given to a part of a company owned by an investor.
Canada See Systematic transfer plan.
Strip Bonds
Canada The capital portion of a bond from which the coupons have been stripped. The holder of the strip bond is entitled to its par value at maturity, but not the annual interest payments.
Systematic Transfer Plan
Canada Plans offered by mutual fund companies that allow unitholders to transfer units from one fund to another at regular intervals.
Systematic Withdrawal Plan
Canada Plans offered by mutual fund companies that allow unitholders to receive payment from their investment at regular intervals.
Tax Credit
Canada An income tax credit that directly reduces the amount of income tax paid by offsetting other income tax liabilities.
Tax Deduction
Canada A reduction of total income before the amount of income tax payable is calculated.
Tax Wrapper
Europe An extra layer which surrounds an investment product, sheltering it from paying certain taxes.
Technical Analysis
Canada A method of evaluating future security prices and market directions based on statistical analysis of variables such as trading volume, price changes, etc., to identify patterns.
Term Insurance
Canada Temporary life insurance that covers the policyholder for a specific time.
Term to 90 Annuity
Canada An annuity that pays a fixed amount each year until it is exhausted in the year that the annuitant turns 90.
Tied Agent
Europe A type of financial adviser who can only sell you products from one financial institution, such as an adviser in a High Street bank who only sells that bank's product.
Time Horizon
Asia The amount of time, usually expressed in years, that an investor expects to hold an investment.
Total Expense Ratio
Europe Provides investors with a clearer picture of the total annual costs for running a unit trust or OEIC. It consists principally of the manager's annual charge, but also includes the costs for other services paid for by the fund, such as the fees paid to the trustee/depositary, custodian, auditors and registrar.
Total Return
USA A measure of a fund's performance that encompasses all elements of return: dividends, capital gain distributions, and changes in net asset value. Total return is the change in value of an investment over a given period, assuming reinvestment of any dividends and capital gain distributions, expressed as a percentage of the initial investment.
Tracker Funds
Europe Tracker funds aim to mirror the progress of a stock market index, by buying and selling shares in the same proportions as represented on the index. These are also sometimes called index (tracker) funds or passive managed funds.
Canada A securities transaction.
Trailer Fees
Canada A fee paid to the salesperson by the mutual fund management company in recognition of the ongoing service they must provide to investors. The fee is based on a small percentage (such as 0.25% annually) of the salesperson's total client assets in the fund. Typically, the fee is paid quarterly.
Trailing Commissions
Canada See Trailer fees.
Canada Any financial or non-financial entry recorded in a client's account.
Transaction Date
Canada See Trade date.
Canada The redemption of units in one account to purchase units in another account within a family of funds. The redemption and purchase occur at the same time.
Transfer Agent
USA The organization employed by a mutual fund to prepare and maintain records relating to shareholder accounts.
Canada The company that keeps track of the names, addresses, transactions, and the number of units owned by investors.
Treasury Bill (T-bill)
Canada Short-term government debt. Treasury bills bear no interest, but are sold at a discount. The difference between the discount price and par value is the return to be received by the investor.
Canada An instrument placing ownership of property in the name of one person, called a trustee, to be held by the trustee for the use and benefit of some other person.
Trust Deed
Europe This document establishes the legal constitution, structure and organisation of a unit trust. The OEIC equivalent is known as an instrument of incorporaiton.
Europe Responsible for overseeing the fund manager's activities in relation to a unit trust. Usually a large bank, the trustee must be independent of the fund manager. It acts in the interests of the investors, owning the investments in the fund on their behalf. It also ensures the fund is invested according to its investment objectives and that the manager complies with the regulations. The OEIC equivalent is known as the depositary.
Asia The party named in a trust or plan who is authorized to hold the assets of the trust or plan for the benefit of the beneficiaries or participants.
Canada 'In the case of a mutual fund trust, the trustee is the individual or company responsible for representing the interests of the investors. The trustee may delegate various business responsibilities to other organizations but still remains ultimately responsible for the interests of the fund. In the case of a registered plan such as an RRSP, the trustee is responsible for ensuring that the plan is administered according to its terms and in accordance with government regulations.'
Europe A fund that can be marketed in all countries in the European Union. UCITS stands for 'Undertaking for Collective Investment in Transferable Securities'
Unauthorized Fund
Asia A unit trust or mutual fund that has not been approved for sale to the general public in Hong Kong by the Securities & Futures Commission.
USA The organization that sells a mutual fund's shares to broker-dealers and investors.
Canada An investment firm that purchases a security directly from its issuer for resale to other investment firms or the public or sells for such issuer to the public.
Asia A unit of ownership in a unit trust/mutual fund.
Unit Investment Trust (UIT)
USA An investment company that buys and holds a fixed number of shares until the trust's termination date. When the trust is dissolved, proceeds are paid to shareholders. A UIT has an unmanaged portfolio. Like a mutual fund, shares of a UIT can be redeemed on any business day.
Unit Linked Policies
Europe These are insurance products where you pay a premium which is then invested in a fund holding a range of assets, usually including equities and fixed interest securities. Part of the premium paid pays for life assurance. Unit linked policies are similar to with-profits products but do not invest in as many assets.
Europe Unit trusts are divided into 'units' of equal value, therefore an investor buys units in the unit trust. The OEIC equivalent is known as a share.
Unit Trust
Europe Private individuals pool their contributions with others, which combine to form a large fund. The fund invests in a spread of different assets to minimise the risk of loss. Also known as collective/pooled investments or investment funds. Unit trusts are usually dual priced although some can be single priced
Asia A collective investment vehicle that pools the money of like-minded investors and invest into securities with a specific objective. Same as mutual fund.
Canada An unincorporated fund whose organizational structure permits the conduit treatment of income realized by the fund.
Universal Life Insurance
Canada A life insurance term policy that is renewed each year and which has both an insurance component and an investment component. The investment component invests excess premiums and generates returns to the policyholder.
Valuation Point
Europe The name given to the time of day that unit trusts or OEICs are valued and then priced.
Variable Life Annuity
Canada An annuity providing a fluctuating level of payments, depending on the performance of its underlying investments.
Canada In pension terms, the right of an employee to all or part of the employer's contributions, whether in the form of cash or as a deferred pension.
Asia The degree of fluctuation in the value of a unit trust or mutual fund, or index, volatility is often expressed as a mathematical measure such as a standard deviation or beta. The greater a fund's volatility, the wider the fluctuations between its high and low prices.
Voluntary Accumulation Plan
Canada A plan offered by mutual fund companies whereby an investor agrees to invest a predetermined amount on a regular basis.
Voluntary Contributions
Asia Additional investments in a retirement plan from either the employer or the employee. A common way for people to save more for their retirement nest egg.
Warrant Fund
Asia A unit trust or mutual fund that invests in warrants - the entitlement to purchase a certain amount of common stock at a set price over a period of time. Normally considered as a high-risk investment.
Europe A security that offers the owner the right to purchase the shares of a company at a fixed date, usually at a fixed price.
Canada Certificates allowing the holder the opportunity to buy shares in a company at a stated price over a specified period. Warrants are usually issued in conjunction with a new issue of bonds, preferred shares or common shares.
With Profits
Europe A with-profits fund is a pooled insurance product. With-profits funds pool together premiums paid by a number of investors, which the insurance company then invests in a very wide range of assets. (See also unit-linked policies).
Wrap Account
Canada An account offered by investment dealers whereby investors are charged an annual management fee based on the value of invested assets.
Europe The amount of income generated by a fund's investments in relation to the price. Equity funds will quote net (after tax and charges). Fixed interest securities will quote gross.
Canada Annual rate of return received on investments, usually expressed as a percentage of the market price of the security.
Yield Curve
Canada A graphic representation of the relationship among yields of similar bonds of differing maturities.
Yield to Maturity
Canada The annual rate of return an investor would receive if a bond were held until maturity.
Zero Coupon Bond
Canada A bond that pays no interest and is initially sold at a discount.
Zero Dividend Preference Shares
Europe Preference shares which do not pay out dividends but instead pay out a predetermined amount at the end of the investment period.


2016 Annual Conference Website is Live!

The website for the 2016 Annual Conference in Osaka, Japan is now live!! See Members' Zone homepage for link.

2015 Conference in Rio de Janeiro Concludes

Conference Presentations are now available in 2015 Conference Tab in Members' Zone!