Glossary

Home
Glossary
Investment Manager

Investment Manager

The person or people who have been given the job of managing the company’s assets by the Board of the investment company.

Alternative Investment Fund Managers Directive

The Alternative Investment Fund Managers Directive is a complicated piece of EU legislation designed to regulate the management, administration and marketing of Alternative Investment Funds or AIFs (which includes investment companies). Since it was brought in all investment companies have had to decide who is the manager or AIFM – a difficult decision for some funds. […]

Real Estate Investment Trust or REIT

Real Estate Investment Trust or REIT – A REIT is a listed property company in a tax efficient structure: REITs must pay out 90% of their property income to shareholders every year. REITs must be primarily engaged in property investment, rather than in development or other non-property related activities. As REITs are all listed property […]

Risk – in investment

Risk is really all about two things – the chance of losing some or all of your money and the chance that, over the short-term, the value of your investment might change dramatically (volatility). When investment managers talk about risk they are often talking about how big their bets are relative to their benchmark or […]

Currency hedging

Currency hedging is an attempt to reduce the effects of currency fluctuations on investment performance. To hedge an investment, investment managers will set up a related currency investment designed to offset changes in the value of the currency. In general, currency hedging reduces the increase or decrease in the value of an investment due to […]

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, […]

underweight

underweight – when a portfolio holds more of an asset than in the index Underweight is used as a relative term, generally to something neutral, generally an index and often refers to a benchmark. The opposite is overweight See also neutral weight Example Stock A is 10% of an index. A portfolio holds 8% of Stock […]

overweight

overweight – when a portfolio holds more of an asset than in the index Overweight is used as a relative term, generally to something neutral, generally an index and in the context of a benchmark. The opposite is underweight See also neutral weight Example Stock A is 10% of an index. A portfolio holds 12% of […]

Currency movement

Currency movement – Often, in reports, companies and investment managers will give the reason for performance to to be the strengthening or weakening of one currency against another. Currency movements (unless hedged) can have a significant impact on the performance of a portfolio. Taken from the point of view of a UK based investor who […]

Markets in Financial Instruments Directive (MiFID)

Markets in Financial Instruments Directive (MiFID) is the framework of European Union (EU) legislation for investment intermediaries that provide services to clients around shares, bonds, units in collective investment schemes and derivatives (collectively known as ‘financial instruments’) MiFID was applied in the UK from November 2007 and was revised by MiFID II, which took effect in […]