Accumulation unit (Acc)
A type of unit or share that provides the facility for the automatic reinvestment of income earned from the underlying portfolio. The number of Accumulation units does not change as income is reinvested. In the case of UK-domiciled funds, income is reinvested on a nett (after tax) basis. For funds based in offshore domiciles, reinvestment is normally transacted on a gross basis. The liability of individual investors to tax is determined by their country of residence. Broadly speaking, this type of investment is more suited for longer-term investors who are primarily seeking capital growth.
Performance figures that cover a rolling period, whether annually, monthly, weekly or daily. For example, on 14 March 2001, the one-year trailing return would cover the period from 14 March 2000 through 14 March 2001 and the one-week trailing return would cover the period from 7 March to 14 March 2001.
The trading of securities to take advantage of market opportunities as they occur, in contrast to passive management. Active managers rely on research, market forecasts, and their own judgement and experience in selecting securities to buy and sell.
The day-to-day costs for basic administrative services, such as plan recordkeeping, accounting, and legal and trustee services, that are necessary to run a retirement plan. These expenses may also include the costs of telephone voice-response systems, access to a customer service representative, educational seminars, retirement planning software, investment advice, electronic access to plan information, daily valuation and online transactions.
An investment approach that accepts above-average risk of loss in return for potentially above-average investment returns.
Aggressive growth fund
An investment fund that takes higher risk of loss in return for potentially higher returns or gains.
Enter the currency amount invested in the fund. The Portfolio Tool will then find the price and number of shares automatically.
Comparison of the performance of the fund, its category and the category index over calendar year periods.
Refers to the conversion of the return on an investment into a yearly rate. For example, if Fund A returned 5% over six months and Fund B returned 4% over four months, Fund A's annualised return is 10,25% and Fund B's is 12,49%.
Deciding how to spread an investment between categories of financial assets (including shares, bonds, cash) and tangible assets (including real estate, commodities, precious metals and collectibles). Asset allocation is generally driven by the desire to optimise the risk-return trade-off according to an investor’s time frame and investment objectives.
Broad investment categories that offer differing levels of risk and return, such as shares, bonds, property and cash. Shares tend to provide the best potential for capital growth, but with relatively high levels of risk. Bonds offer income with a moderate degree of risk. Property offers capital growth, but with the potential for illiquidity. Cash presents the lowest level of expected return, but ensures liquidity and the safety of the original investment.
A general term for management of a portfolio of a pre-determined group of asset classes, such as shares, bonds or cash.
Asset in top 10 holdings
This Average row shows the average of the different data points of the funds that have met search criteria. The data points include management fees, all the return figures (that is one day, one year, three years etc.) where applicable, Morningstar ratings, Style Box details and standard deviation.
A sales charge investors pay when they redeem (or sell) mutual fund shares, insurance products or other investments, generally used to compensate brokers. Also known as a Deferred Sales Charge.
A mutual fund that invests in a combination of asset classes (usually stocks and bonds and, in some cases, cash equivalents). Balanced funds seek to provide growth and income.
A common index widely used to measure performance of US bond funds.
Point one-hundredth of one percent, or 0.01%. For example, 20 basis points is equivalent to 0.20%. Investment expenses, interest rates, and yield differences among bonds are often expressed in basis points.
The currency of the transaction.
Currency class shares
Currency class shares occur when a fund issues shares priced in a currency different to the fund's base currency. Distributions of currency class shares are quoted in the same currency as the currency class. The different currencies and varying exchange rates regularly result in different performance figures for the different currency class shares. Base currency class refers to the share class for the Base Currency.
A fall in the value of one currency in relation to another. A movement in floating exchange rates results in one unit of a currency buying fewer units of another currency, thus the value of the first currency has depreciated. For example, with a floating exchange rate, if last week £1 bought $1.50 and this week £1 buys $1.45, the value of the pound has depreciated relative to the dollar because you get less dollars for the same amount of pounds.
The decrease in the value of a currency in comparison to another, often the result of a government announcement.
Date of inception
The date the fund was launched.
An after-tax distribution of a company’s or fund´s profits to shareholders, normally specified in pence per share in Britain. Dividends are usually paid twice a year – interim and final.
A percentage that is calculated by dividing total dividends by the current price and multiplying by 100. For example, if a fund distributed a 10p dividend and the current share price is 210p the dividend yield is 4.76%.
The average time to payment. Also a measure of the effect of interest rate changes on the price of a fixed income asset or portfolio. Duration is defined in years (that is a three year duration means the value of the bond could rise about 3% if interest rates fall by 1%).
Earnings per share (EPS)
A company’s total earnings divided by the current number of shares outstanding. EPS gauges the profitability of the company from the view of the shareholders. It is used to calculate the price-to-earnings ratio P/E.
Consists of alternating periods of economic expansion and contraction typified by changing interest rates, employment levels and productivity, combining to form a long-term overview. The current economic period (that is growth, recession) will affect the performance of investment sectors.
An alternative term for shares.
A fund investing primarily in shares. It can be based on any number of investment strategies.
By selecting this box, the user can override the sector weight defaults. The default weights are aiming to maintain a high level of diversification and have been established by reference to the US and European equity markets, with a further reduction in the large weight of financial stocks in both markets. The user can act either on the sectors themselves, or on the super sectors, using the relevant buttons. When the user acts on super sectors, the respective weights of the sectors inside each super sector retain their original relative weights for maximum diversification.
Ex-dividend / Ex-coupon
The term ‘Ex’ is used to indicate that the share is currently available in the market with a lack of certain specific rights and conditions. ‘Ex dividend’ refers to a share sold without the right to the dividend – the seller retains the declared dividend. Ex-dividends are normally sold in the period between the announcement and payment of the dividend.
The expense ratio is the annual fee that all funds or Exchange Traded Funds (ETF) charge their shareholders. It expresses the percentage of assets deducted each fiscal year for fund expenses, including distribution fees, management fees, administrative fees, operating costs, and all other asset-based costs incurred by the fund. Portfolio transaction fees, or brokerage costs, as well as initial or deferred sales charges are not included in the expense ratio. The expense ratio, which is deducted from the fund's average net assets, is accrued on a daily basis.
Fees and expenses
The average fees and expenses for all funds in the portfolio.
A 12-month accounting period over which a company reports its profits. It is not aligned with the calendar or tax year.
An individual, employed by a fund group, who is responsible for managing a fund's portfolio.
Fund of Funds
The transfer of money from one fund to another within a fund family.
A fund that invests in UK and international shares or bonds.
Growth and income fund
A stock with a low price to earning ratio but high EPS growth.
The Inception date is the date the fund was formed and became available for sale to unit holders.
A holding in a unit trust that pays out on a regular basis any dividends or interest your investment makes.
Broadly speaking, this type of investment is more suited to people who wish to invest in order to generate a stream of income (and these dividends are taxable like other dividends).
A fund that tracks a particular index and attempts to match the returns of that index. The fund manager typically studies the index's movements to ensure the fund's securities are representative of the index with the sectors matched proportionally. Sometimes called a tracker fund.
The level at which wages and prices increase over a certain period of time, usually a year. In the UK, this is measured by the Retail Price Index (RPI) and the index of National Average Earnings (NAE).
The fee payable to a management company upon the purchase of units to pay for administration, marketing of the fund and commission to the adviser(where applicable).
Stands for International Securities Identification Number (ISIN). A coding system used to distinguish securities.
The proportion of a fund invested in larger companies [large caps]. Large cap companies are defined as those in the top 5% of capitalisation within their global region.
The stock market sector making up the biggest proportion of a fund such as financials, services or technology.
A measure of how easy it is to buy and sell shares without notably moving the share price.
Investing a sum in one go rather than spreading it over monthly payments. The opposite of regular saving.
A fee, usually expressed as a percentage, charged by the investment manager to cover the costs of running the fund. It is deducted from the net assets of the fund.
The date on which the principal of a debt instrument, i.e. a bond, is due to be paid. For example, the maturity date for a five-year bond issued on 1 November 2000 would be 1 November 2005.
The annualised performance of a fund over three years.
The smallest lump sum amount that a new investor can put into a fund.
Minimum lump-sum investment
The smallest amount of money an investor can put into a fund. Typically, this can either be to open the account or for topping up the account.
Nett asset value (NAV)
The value of the investments in a fund. In the case of a unit trust or OEIC the nett asset value per share normally corresponds to the fund's market price, subject to any sales or exit charge. However, the market price and the nett asset value may vary noticeably for an investment trust. (See Discount to NAV and Premium to NAV.)