Glossary

reference benchmark

reference benchmark – When a fund does not have a benchmark, investment companies and investment managers offer reference or a comparitor benchmark.

This helps investors / shareholders appreciate how the NAV and share prices have done and helps put that performance into context.

Funds that do not have a benchmark index are often absolute return funds, a total return funds or pure unfettered stock picking funds.

comparitor – as a substitute benchmark

comparitor – When a fund does not have a benchmark, investment companies and investment managers offer a comparitor or reference benchmark. This helps investors / shareholders appreciate how the NAV and share prices have done and helps put that performance into context. Funds that do not have a benchmark index are often absolute return funds, […]

Benchmark

A way of measuring how well the company is doing – benchmarks can be indices (e.g. the FTSE 100 index), a level of return (e.g. the Bank of England base rate) or the performance of other competing companies. Investment Managers often use the Benchmark as a reference point for the amount that they hold in stock in their […]

underperform or outperform

underperform or outperform – relative terms regarding performance, usually compared to an index, benchmark or peer group. See also comparitor and reference benchmark A fund underperforms its benchmark index or outperforms it. see also beta

SONIA

SONIA is the abbreviation for the Bank Of England’s Sterling Overnight Index Average and was first introduced in March 1997. SONIA is a widely used interest rate benchmark and the reference rate for sterling Overnight Indexed Swaps (OIS). The Bank of England became its administrator in April 2016, and introduced a series of reforms of the benchmark in April […]

Peer group

A peer group is a selection of similar funds or companies. Peer group returns and rankings are often used to see if the investment managers are doing as good as or better job than their competitors. This is often done with reference to a benchmark that they may or may not share.

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Glossary

reference benchmark