Glossary
| Term | Definition |
|---|---|
| 10-Year Breakeven Inflation Rate | Represents a measure of expected inflation derived from 10-Year Treasury Constant Maturity Securities and 10-Year Treasury Inflation-Indexed Constant Maturity Securities. The latest value implies what market participants expect inflation to be in the next 10 years, on average. |
| 10-Year Government Bond | The yield on 10-year US Treasury bonds. |
| 30-Day Median Bid/Ask Spread | The median bid-ask spread is calculated by identifying the national best bid and national best offer (NBBO) for each fund as of the end of each 10 second interval during each trading day of the last 30 calendar days and dividing the difference between each such bid and offer by the midpoint of the NBBO. The median of those values is identified and that value is expressed as a percentage rounded to the nearest hundredth. |
| 30-Day SEC Yield | Reflects the dividends and interest earned during the period, after the deduction of the Fund's expenses. |
| 30-Day SEC Yield (Unsubsidized) | Reflects the dividends and interest earned during the period, after the deduction of the Fund's expenses, excluding fee waivers. |
| AAA | The highest possible rating that may be assigned to an issuer's bonds by any of the major credit rating agencies. AAA-rated bonds have a high degree of creditworthiness because their issuers are easily able to meet financial commitments and have the lowest risk of default. |
| Acquired Fund Fees and Expenses | Expenses incurred indirectly by the Fund through its ownership of shares in other investment companies and are not direct costs paid by Fund shareholders. |
| Active Management | The practice of selecting individual investments with discretion. The opposite of Passive Management. |
| Adjusted Funds From Operations (AFFO) | A measure of the financial performance of a Real Estate Investment Trust (REIT) which takes into consideration the maintenance costs of the real estate property over its life. |
| Aggressive Growth Blended Benchmark (95% Equity) | A blended benchmark consisting of 67% Russell 3000 Index - TR / 28% Morningstar Global Markets ex-US Index - NR / 3% Bloomberg US Universal Index - TR / 2% ICE BofAML Treasury 3 Month Index - TR. One may not invest directly in an index. |
| Alerian Midstream Energy Select Index | A composite of North American energy infrastructure companies. The capped, float-adjusted, capitalization-weighted index constituents are engaged in midstream activities involving energy commodities. One may not invest directly in an index. |
| Alerian MLP Index | The leading gauge of energy infrastructure Master Limited Partnerships (MLPs). The capped, float-adjusted, capitalization-weighted index constituents earn the majority of their cash flow from midstream activities involving energy commodities. One may not invest directly in an index. |
| Alerian MLP Infrastructure Index | A composite of energy infrastructure Master Limited Partnerships (MLPs). The capped, float-adjusted, capitalization-weighted index constituents earn the majority of their cash flow from midstream activities involving energy commodities. One may not invest directly in an index. |
| Alpha | A measure of performance on a risk-adjusted basis; often considered the active return on an investment, the ratio gauges the performance of an investment against a market index used as a benchmark. |
| Asset Allocation | An investment strategy that aims to balance risk and reward by apportioning a portfolio's assets according to an investor’s goals, risk tolerance and investment horizon. |
| Baa | Bonds can receive ratings that range from a high of Aaa to a low of C. Bonds given the Baa rating are considered as medium-grade obligations, meaning they are neither highly protected nor poorly secured. Bonds rated Baa and above are considered investment grade. |
| Backwardation | When the futures price of an underlying asset is lower than the spot price/current price. |
| Balanced Blended Benchmark (60% Equity) | A blended benchmark consisting of 42% Russell 3000 Index - TR / 18% Morningstar Global Markets ex-US Index - NR / 32% Bloomberg US Universal Index - TR / 6% FTSE WGBI Non-USD Index / 2% ICE BofAML Treasury 3 Month Index - TR. One may not invest directly in an index. |
| Balloon Balance | A lump sum principal balance owed that is paid at the end of a loan term, often as part of interest-only commercial mortgages. |
| Barron's 400 Index | Seeks to track the performance of the most fundamentally sound companies with the best growth prospects in the US. The Index uses fundamental analysis and a growth at a reasonable price (GARP) methodology to select the top 400 constituents in the US equity universe after filtering for liquidity and diversification over size and sectors. One may not invest directly in an index. |
| Basis Point (bps) | A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. |
| Basis Recapture | The difference between the cost basis (which is adjusted for return of capital) and the actual purchase price. |
| Bear Market | A condition where a market experiences prolonged price declines, usually when securities prices fall 20% or more from recent highs amid widespread pessimism and negative investor sentiment. |
| BEst (Bloomberg Estimates) Earnings per Share (EPS) | Reflects the consensus estimate for adjusted earnings per share. The consensus estimate is the mean of sell-side analyst estimates. |
| BEst (Bloomberg Estimates) Long-Term Growth (LTG) in Earnings per Share (EPS) | The estimated Compounded Annual Growth Rate (CAGR) of the operating Earnings per Share (EPS) over the company's next full business cycle (typically 3-5 years). |
| Beta | A measure of the volatility, or systematic risk, of a security or a portfolio in comparison to the market or a benchmark. The beta of the market or benchmark is 1.00 by definition. An investment with a beta above 1 is more volatile than the overall market, while an investment with a beta below 1 is less volatile. |
| Bloomberg 1-3 Year US Government/Credit Index | Includes all medium and larger issues of US government, investment-grade corporate, and investment-grade international dollar-denominated bonds that have maturities of between 1 and 3 years and are publicly issued. One may not invest directly in an index. |
| Bloomberg 1000 Index | A float market-cap-weighted benchmark of the 1000 most highly capitalized US companies. One may not invest directly in an index. |
| Bloomberg 2000 Index | Measures the performance of the small-cap segment of the US equity universe. One may not invest directly in an index. |
| Bloomberg 500 Index | Bloomberg’s US Large Cap Price Return Index that contains the 500 most highly capitalized US companies weighted by float market cap. One may not invest directly in an index. |
| Bloomberg Agriculture Subindex (BCOMAGTR Index) | Formerly known as the Dow Jones-UBS Agriculture Subindex (DJUBAGTR), the index is a commodity group subindex of the Bloomberg CITR. The index is composed of futures contracts on coffee, corn, cotton, soybeans, soybean oil, soybean meal, sugar and wheat. It reflects the return on fully collateralized futures positions and is quoted in USD. One may not invest directly in an index. |
| Bloomberg Commodity Index | An unmanaged index used as a measurement of change in commodity market conditions based on the performance of a basket of different commodities. One may not invest directly in an index. |
| Bloomberg Commodity Spot Index | Measures the price movements of commodities included in the Bloomberg Commodity Index (BCOM) and select subindexes. One may not invest directly in an index. |
| Bloomberg Energy Subindex (BCOMENTR Index) | A commodity index composed of futures contracts on crude oil, heating oil, unleaded gasoline and natural gas. It reflects the return of underlying commodity futures price movements only and is quoted in USD. One may not invest directly in an index. |
| Bloomberg Global Aggregate Bond Index | Measures the performance of the global investment grade, fixed-rate bond markets, including government, government-related and corporate bonds, as well as asset-backed, mortgage-backed and commercial mortgage-backed securities from both developed and emerging markets issuers. One may not invest directly in an index. |
| Bloomberg Government Bond Index | Comprises securities issued by the US Government (i.e., securities in the Treasury and Agency Indices). Inclusions: Public obligations of the US Treasury with a remaining maturity of one year or more. Publicly issued debt of US Government agencies, quasi-federal corporations, and corporate or foreign debt guaranteed by the US Government. One may not invest directly in an index. |
| Bloomberg Industrial Metals Subindex (BCOMINTR Index) | Reflects the returns that are potentially available through an unleveraged investment in the futures contracts on industrial metal commodities. One may not invest directly in an index. |
| Bloomberg Intermediate US High Yield Index | Measures the USD-denominated, high yield, fixed-rate corporate bond market. Securities are classified as high yield if the middle rating of Moody’s, Fitch and S&P is Ba1/BB+/BB+ or below. The intermediate duration segment of the index includes bonds with maturities of 1 to 10 years. One may not invest directly in an index. |
| Bloomberg Long Term Treasury Index | Comprises securities in the long maturity range of the US Treasury Index. The US Treasury Index represents the public obligations of the US Treasury with a remaining maturity of one year or more. One may not invest directly in an index. |
| Bloomberg Municipal Bond 1-15 Year Blend Index | An unmanaged index comprised of fixed-rate, investment-grade tax-exempt bonds with remaining maturities between 1 and 17 years. One may not invest directly in an index. |
| Bloomberg Municipal Index | Serves as a benchmark for the US municipal bond market. One may not invest directly in an index. |
| Bloomberg Nymex WTI Cushing Crude Oil First Month 321 Crack Spread Index | An index that measures the difference between three crude oil futures contracts versus two gasoline futures contracts and one heating oil futures contract. One may not invest directly in an index. |
| Bloomberg Precious Metals Subindex (BCOMPRTR Index) | Reflects the returns that are potentially available through an unleveraged investment in the futures contracts on precious metals commodities. The Index currently consists of two precious metals commodities futures contracts (gold and silver). One may not invest directly in an index. |
| Bloomberg US 1000 Growth Index | Provides exposure to companies with superior growth factor scores based on their earnings yield, valuation, dividend yield and growth. One may not invest directly in an index. |
| Bloomberg US 1000 Index | A float market-cap-weighted benchmark of the 1000 most highly capitalized US companies. One may not invest directly in an index. |
| Bloomberg US 3000 Index | A float market-cap-weighted benchmark of the 3000 most highly capitalized US companies. One may not invest directly in an index. |
| Bloomberg US Aggregate Bond Index | A broad-based benchmark that measures the investment grade, US dollar-denominated, fixed-rate taxable bond market. The index includes Treasuries, government-related and corporate securities, fixed-rate agency MBS, ABS and CMBS (agency and non-agency). One may not invest directly in an index. |
| Bloomberg US Asset-Backed Securities Index | A broad-based flagship benchmark that measures the investment grade, US dollar-denominated, fixed-rate taxable bond market. The index only includes ABS securities. One may not invest directly in an index. |
| Bloomberg US Corporate Bond Index | Measures the investment grade, fixed-rate, taxable corporate bond market. One may not invest directly in an index. |
| Bloomberg US Corporate High Yield Bond Index | Measures the USD-denominated, high yield, fixed-rate corporate bond market. One may not invest directly in an index. |
| Bloomberg US Credit Index | Comprises the US Corporate Index and a non-corporate component that includes foreign agencies, sovereigns, supranationals and local authorities. The US Credit Index was called the US Corporate Investment Grade Index until July 2000, when it was renamed to reflect its inclusion of both corporate and non-corporate issuers. Index history is available back to 1973. The US Credit Index is a subset of the US Government/Credit Index and the US Aggregate Index. One may not invest directly in an index. |
| Bloomberg US Government Securities Liquidity Index | A gauge of deviations in yields from a fair-value model. One may not invest directly in an index. |
| Bloomberg US Government/Credit 1 Year Duration Index | Measures the non-securitized component of the Bloomberg US Aggregate Bond Index. It includes investment grade, USD-denominated, fixed-rate Treasuries, government-related and corporate securities. The 1-year duration segment of the index includes bonds approaching 1 year in maturity. One may not invest directly in an index. |
| Bloomberg US Government/Credit Index | A broad-based benchmark that measures the non-securitized component of the US Aggregate Index. It includes investment grade, US dollar-denominated, fixed-rate Treasuries, government-related and corporate securities. One may not invest directly in an index. |
| Bloomberg US Government/Credit Long Duration Index | Measures the non-securitized component of the Bloomberg US Aggregate Bond Index. It includes investment grade, USD-denominated, fixed-rate Treasuries, government-related and corporate securities. The long duration segment of the index includes bonds with maturities greater than 10 years. One may not invest directly in an index. |
| Bloomberg US Large Cap Index | A float market-cap-weighted benchmark of the 500 most highly capitalized US companies. One may not invest directly in an index. |
| Bloomberg US Long Treasury Index | Measures the performance of US dollar-denominated, fixed-rate, nominal debt issued by the US Treasury with a maturity greater than 10 years. One may not invest directly in an index. |
| Bloomberg US Short Treasury Index | Measures the performance of the US Treasury bills, notes, and bonds under 1 year to maturity. One may not invest directly in an index. |
| Bloomberg US Treasury Index | Measures US dollar-denominated, fixed-rate, nominal debt issued by the US Treasury. One may not invest directly in an index. |
| Bloomberg US Treasury Intermediate Index | Measures US dollar-denominated, fixed-rate, nominal debt issued by the US Treasury with maturities of 1 to 9.9999 years to maturity. One may not invest directly in an index. |
| Bloomberg US Treasury US TIPS Index | Measures the performance of the US treasury inflation-linked bond market. One may not invest directly in an index. |
| Bloomberg US Universal Index | Represents the union of the US Aggregate Index, US Corporate High Yield Index, Investment Grade 144A Index, Eurodollar Index, US Emerging Markets Index, and the non-ERISA eligible portion of the CMBS Index. The index covers USD-denominated, taxable bonds that are rated either investment grade or high-yield. One may not invest directly in an index. |
| Bond Rating | A letter-based credit scoring scheme used to judge the quality and creditworthiness of a bond. Investment grade bonds are assigned “AAA” to “BBB-“ ratings from Standard & Poor's, and Aaa to Baa3 ratings from Moody’s. Junk bonds have lower ratings. The higher a bond's rating, the lower the interest rate it will carry, all else equal. |
| Book Value | The net value (assets minus liabilities) of a firm's assets found on its balance sheet. |
| Bull Market | A financial market in which prices are trending upward or are expected to trend upward. |
| Bull Run | An extended bull market. |
| Capital Expenditures (CAPEX/Capex/CapEx) | Refers to investments in physical assets such as plant and machinery. Numbers sourced from Bloomberg reported on trailing 12 month basis, per share basis. |
| Cash Flow | The net balance (inflows minus outflows) of cash moving into and out of a business at a specific point in time. |
| Cash Flow Return on Invested Capital (CFROI) | A metric of economic return of a company developed by HOLT Value Associates. Calculated as Operating Cash Flow divided by Capital Employed. |
| ChatGPT (Chat Generative Pre-trained Transformer) | A chatbot developed by OpenAI and launched on November 30, 2022. Based on a large language model, it enables users to refine and steer a conversation towards a desired length, format, style, level of detail and language. |
| CIBC Atlas Clean Energy Index | An adjusted market cap weighted index designed to provide exposure to a diverse set of US or Canadian based companies involved in the clean energy sector including renewables and clean technology. The clean energy sector is comprised of companies that provide the products and services which enable the evolution of a more sustainable energy sector. One may not invest directly in an index. |
| Commodity Swap Contract | A swap in which exchanged cash flows are dependent on the price of an underlying commodity. A commodity swap is usually used to hedge against the price of a commodity. |
| Compound Annual Growth Rate (CAGR) | The mean annual growth rate of an investment or asset over a specified period of time longer than one year. |
| Conservative Blended Benchmark (20% Equity) | A blended benchmark consisting of 14% Russell 3000 Index - TR / 6% Morningstar Global Markets ex-US Index - NR / 58% Bloomberg US Universal Index - TR / 12% FTSE WGBI Non-USD Index / 10% ICE BofAML Treasury 3 Month Index - TR. One may not invest directly in an index. |
| Consumer Price Index (CPI) | A measure of the average change over time in the prices paid by urban consumers for a representative basket of consumer goods and services. One may not invest directly in an index. |
| Contango | When the futures price of an underlying asset is higher than the spot price/current price. |
| Core Inflation | A measure of the change in the costs of goods and services, excluding the costs of energy and food sectors. |
| Correlation | A statistic that measures the degree to which two variables move in relation to each other. |
| Coupon Rate/Yield | The amount that investors can expect to receive in income as they hold the bond. |
| Crack Spreads | The difference in price between a refined product (or group of products) and crude oil. It is used as a rough indicator of market conditions, roughly approximating the margin from processing crude oil through a refinery. |
| Credit Positioning | The practice of adjusting credit risk exposures based on risk/return expectations among varying credit qualities. |
| Credit Quality | The risk of default, often in reference to a debt instrument. |
| Credit Rating | An assessment of the creditworthiness of a borrower in general terms or with respect to a particular debt or financial obligation. |
| Credit Risk | The risk of default due to failure to make an obligatory payment on a debt instrument. |
| Cyclically-Adjusted Price-to-Earnings (CAPE) Ratio | A valuation metric calculated by dividing a company’s stock price by the average of the company’s earnings for the last ten years, adjusted for inflation. |
| De-Trend | The practice of removing a trend in a time series to focus only on deviations from the trend. |
| Debt Service Ratio (DSR) | The ratio of total required household debt payments to total disposable income. |
| Debt-to-EBITDA Ratio | Compares a company's total obligations to the actual cash the company brings in from its operations. It reveals how capable the firm is of paying its debt and other liabilities if taxes and the expenses from depreciation and amortization are deferred. |
| Debt-to-Equity (D/E) Ratio | Evaluates a company's financial leverage and is calculated by dividing a company's total liabilities by its shareholder equity. |
| Debt-to-GDP Ratio | A metric that compares a country's public debt to its gross domestic product (GDP). |
| Decentralized Finance (DeFi) | An emerging financial technology that challenges the current centralized banking system. DeFi attempts to eliminate the fees that banks and other financial service companies charge while promoting peer-to-peer transactions. |
| Deep Value | Stocks of companies with extremely low valuation measures. |
| Default Rate | The percentage of all outstanding loans that a lender has written off as unpaid after a prolonged period of missed payments. |
| Disaggregate | The process of breaking down information or data into smaller sub-categories. |
| Discount Rate | The rate of return used to discount future cash flows back to their present value. |
| Discounted Cash Flow (DCF) | Refers to a valuation method that estimates the value of an investment using its expected future cash flows. |
| Distribution Yield | The measure of cash flow paid by an income-paying vehicle. |
| Dividend Yield | A financial ratio that shows how much a Fund pays out in dividends each year relative to its share price. |
| Dogs of the Dow Theory | An investment strategy which proposes that an investor annually select for investment the ten Dow Jones Industrial Average stocks whose dividend is the highest fraction of their price. |
| Dotcom Bubble | The period between 1995 and 2000 when investors poured into money losing Internet-based startups in the hopes that these fledgling companies would soon turn a profit. The technology-centric NASDAQ Composite Index rose five-fold, from less than 1,000 in 1995 to a peak of 5,408.60 on March 10, 2000. Less than three years later, the NASDAQ Composite Index had tumbled to 1,139.90 on Oct. 4, 2002, a 76+% fall. |
| Dow Jones EPAC Select Dividend Index | Aims to represent the performance of high dividend-paying companies in the EPAC (Europe, Pacific, Asia and Canada) region, which covers developed markets excluding the US. One may not invest directly in an index. |
| Dow Jones Equity All REIT Index | Designed to measure all publicly traded real estate investment trusts in the Dow Jones US stock universe classified as equity REITs according to the S&P Dow Jones Indices REIT Industry Classification Hierarchy. These companies are REITs that primarily own and operate income-producing real estate. One may not invest directly in an index. |
| Dow Jones Industrial Average | A stock market index of 30 prominent companies listed on stock exchanges in the United States. The DJIA is one of the oldest and most commonly followed equity indexes. One may not invest directly in an index. |
| Down Capture | A statistical measure of an investment manager's relative performance during bear (down) markets. |
| Duration | A measure of the weighted average term to maturity of a bond's expected cash flows. Duration also represents the approximate percentage change that the price of a bond would experience for a 1% change in yield. For example: the price of a bond with a duration of 5 years would change approximately 5% for a 1% change in yield. The price of a bond with a duration of 10 years would be expected to decline by approximately 10% if its yield was to rise by +1%. Bond yields tend to fluctuate in response to changes in market levels of interest rates. Generally, if interest rates rise, a bond's yield will also rise in response; the duration of the bond will determine how much the price of the bond will change in response to the change in yield. |
| Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) | A measure of a company’s overall financial performance. |
| Earnings Recession | A temporary period where corporate earnings have year-over-year declines, generally for two or more quarters in a row. |
| Earnings Yield | Calculated as 1/Current P/E Ratio. |
| Effective Duration | A specific duration measure designed to describe the percentage change in a debt instrument's price that would result from a 1% change in interest rates. |
| Emergent Beta | The correlation that arises between otherwise unrelated stocks due to the unique interactions and characteristics of the market environment. |
| Energy Select Sector Index (IXE) | A modified capitalization-weighted index representing the performance of energy companies that are components of the S&P 500 Index. One may not invest directly in an index. |
| Enterprise Multiple (EV/EBITDA) | A ratio used to determine the value of a company by considering the company's debt. The enterprise multiple is the enterprise value (EV) (market capitalization + total debt – cash and cash equivalents) divided by EBITDA (earnings before interest, taxes, depreciation and amortization). |
| Enterprise Value to Sales (EV/Sales) | Measures the sum of (market value of a company's equity + outstanding debt - cash) divided by annual sales. |
| Environmental, Social and Governance (ESG) Investment | A set of standards for a company’s behavior used by socially conscious investors to screen potential investments. Environmental criteria consider how a company safeguards the environment, social criteria examine how it manages relationships with employees, suppliers, customers and the communities where it operates, while governance deals with a company’s leadership, executive pay, audits, internal controls and shareholder rights. |
| Equity Duration | The duration of a stock is the average of the times until its cash flows are received, weighted by its present values. High-duration stocks are exposed to substantial discount-rate risk (i.e., changes in yield), whereas low-duration stocks are primarily exposed to cash flow risk. |
| Equity Instruments/Securities (Equities) | Financial assets that represent partial ownership in an investable entity (such as a corporation). |
| EURO STOXX 50 Net Return USD Index | Represents the performance of the 50 largest companies among the 20 supersectors in terms of free-float market cap in Eurozone countries. One may not invest directly in an index. |
| Excess Returns | The return of an investment over that of some benchmark return. |
| Exchange-Traded Fund (ETF) | A type of security that tracks an index, sector, commodity, or other asset, but which can be purchased or sold on a stock exchange the same way a regular stock can. |
| Term | Definition |
|---|---|
| FAANG | Refers to Facebook, Amazon, Apple, Netflix and Google. |
| Factor | Attributes that are associated with higher returns. Includes economic factors such as the rate of inflation, GDP growth, the unemployment rate, the credit rating of a company, trading liquidity and stock price volatility. Style factors include growth versus value stocks, market capitalization and industry sector. |
| Fed Tapering | The gradual slowing of the pace of the Federal Reserve's large-scale asset purchases. Tapering gradually removes the monetary stimulus it has been providing the economy. |
| Federal Funds Rate | The target interest rate set by the Federal Open Market Committee (FOMC). This target is the rate at which the Fed suggests commercial banks borrow and lend their excess reserves to each other overnight. |
| Federal Funds Target | The target interest rate set by the Federal Open Market Committee (FOMC). This target is the rate at which the Federal Reserve (the “Fed”) suggests commercial banks borrow and lend their excess reserves to each other overnight. |
| Federal Funds Target Rate (FFR, Upper Limit) | The upper bound of the Federal Funds Target Rate range, which is the interest rate range in which the Federal Reserve suggests banks lend overnight reserves to each other. |
| Federal Open Market Committee (FOMC) | A branch of the Federal Reserve System, the FOMC determines the direction of monetary policy by directing open market operations. The committee is composed of the seven members of the Board of Governors and five Federal Reserve Bank presidents. |
| Federal Reserve Balance Sheet | A report that lists the Federal Reserve's assets and liabilities which outlines what the Fed is doing to expand or contract its balance sheet as it implements its monetary policy. |
| Financial Conditions Impulse on Growth (FCI-G) Index | Assesses the extent to which financial conditions pose headwinds or tailwinds to economic activity and explicitly considers the lags through which changes in financial variables are estimated to affect future economic activity. One may not invest directly in an index. |
| Financial Ratio | A relative magnitude of two selected numerical values taken from a company's financial statements. Financial ratios are used in ratio analysis, which is a quantitative method of gaining insight into a company's liquidity, operational efficiency and profitability. |
| Fixed Income Instruments/Securities | Contractual obligations for one party to loan another capital in exchange for a predetermined (fixed) interest payment. |
| Floating Rate | As opposed to “fixed rate,” an attribute of debt instruments whereby the rate of interest moves with market interest rates. |
| Forward Price/Earnings (P/E) Ratio | A stock valuation metric that compares a company’s share price to its projected future earnings. |
| Free Cash Flow (FCF) | A measure of cash earnings that excludes the non-cash expenses of the income statement but includes capital assets as well as changes in working capital from the balance sheet. |
| Free Cash Flow (FCF) Yield | A financial solvency ratio that compares the free cash flow per share a company is expected to earn against its market value per share. |
| FTSE / CoreCommodity CRB Index | A basket of 19 commodities, including energy contracts, agriculture, precious metals, and industrial metals, the Index acts as a representative indicator of commodity markets. One may not invest directly in an index. |
| FTSE All-World ex US High Dividend Yield Net Tax (US RIC) Index | Comprises stocks that are characterized by higher-than-average dividend yields (excluding the US), and is based on the FTSE All-World Index. One may not invest directly in an index. |
| FTSE Developed All Cap ex US Index | A market-capitalization weighted index representing the performance of large, mid and small cap companies in Developed markets, excluding the USA. The index is derived from the FTSE Global Equity Index Series (GEIS), which captures 98% of the world's investable market capitalization. One may not invest directly in an index. |
| FTSE Developed All Cap ex US Net Tax (US RIC) Index | A market-capitalization weighted index representing the performance of large, mid and small cap companies in Developed Markets, excluding the US. One may not invest directly in an index. |
| FTSE Developed Europe Qual/Vol/Yield 5% Capped Factor Index | Designed to measure the performance of publicly-listed large-capitalization and mid-capitalization dividend-paying issuers in Europe that meet certain requirements for market capitalization, liquidity, high quality, low volatility and dividend yield. One may not invest directly in an index. |
| FTSE NAREIT All Equity REITs Index | A free-float adjusted, market capitalization-weighted index of US equity REITs. Constituents of the index include all tax-qualified REITs with more than 50 percent of total assets in qualifying real estate assets other than mortgages secured by real property. One may not invest directly in an index. |
| FTSE NAREIT Equity Apartments Index | A subsector index of the FTSE NAREIT US Real Estate Index containing all Apartment REITs in the parent index. One may not invest directly in an index. |
| FTSE NAREIT Equity Data Centers Index | A subsector index of the FTSE NAREIT US Real Estate Index containing all Data Center REITs in the parent index. One may not invest directly in an index. |
| FTSE NAREIT Equity Diversified Index | A subsector index of the FTSE NAREIT US Real Estate Index containing all Diversified REITs in the parent index. One may not invest directly in an index. |
| FTSE NAREIT Equity Health Care Index | A subsector index of the FTSE NAREIT US Real Estate Index containing all Health Care REITs in the parent index. One may not invest directly in an index. |
| FTSE NAREIT Equity Industrial Index | A subsector index of the FTSE NAREIT US Real Estate Index containing all Industrial REITs in the parent index. One may not invest directly in an index. |
| FTSE NAREIT Equity Lodging/Resorts Index | A subsector index of the FTSE NAREIT US Real Estate Index containing all Lodging/Resorts REITs in the parent index. One may not invest directly in an index. |
| FTSE NAREIT Equity Office Index | A subsector index of the FTSE NAREIT US Real Estate Index containing all Office REITs in the parent index. One may not invest directly in an index. |
| FTSE NAREIT Equity Residential REIT Index | A subsector index of the FTSE NAREIT US Real Estate Index containing all Equity Residential REITs in the parent index. One may not invest directly in an index. |
| FTSE NAREIT Equity Retail Index | A subsector index of the FTSE NAREIT US Real Estate Index containing all Retail REITs in the parent index. One may not invest directly in an index. |
| FTSE NAREIT Equity Self Storage Index | A subsector index of the FTSE NAREIT US Real Estate Index containing all Self Storage REITs in the parent index. One may not invest directly in an index. |
| FTSE NAREIT Equity Single Family Homes REIT Index | A subsector index of the FTSE NAREIT US Real Estate Index containing all Single Family Home REITs in the parent index. One may not invest directly in an index. |
| FTSE NAREIT Equity Specialty Index | A subsector index of the FTSE NAREIT US Real Estate Index containing all Specialty REITs in the parent index. One may not invest directly in an index. |
| FTSE NAREIT Infrastructure REITs Index | A subsector index of the FTSE NAREIT US Real Estate Index containing all Infrastructure REITs in the parent index. One may not invest directly in an index. |
| FTSE NAREIT Infrastructure REITs Index | A subsector index of the FTSE NAREIT US Real Estate Index containing all Infrastructure REITs in the parent index. One may not invest directly in an index. |
| FTSE NAREIT Real Estate 50 Index | Consists of the largest 50 eligible real estate investment trusts (REITs) within the FTSE NAREIT Composite Index when ranked by full equity market capitalization. One may not invest directly in an index. |
| FTSE NAREIT US Real Estate Index | Tracks the performance of the US REIT industry at both an industry-wide level and on a sector-by-sector basis. One may not invest directly in an index. |
| FTSE USA Qual/Vol/Yield Factor 5% Capped Index | Designed to measure the performance of publicly-listed large-capitalization and mid-capitalization dividend-paying issuers in the United States that meet certain requirements for market capitalization, liquidity, high quality, low volatility and dividend yield. One may not invest directly in an index. |
| FTSE USA Small Cap ex Real Estate 2Qual/Vol/Yield 3% Capped Factor Index | Comprised of securities within the FTSE USA Small-Cap Index, excluding Real Estate. The index is designed to reflect the performance of three recognized equity risk factors: quality, low volatility and yield. One may not invest directly in an index. |
| FTSE USA Small Cap Qual/Vol/Yield 3% Capped Factor Index | Designed to reflect the performance of high quality US small-cap equities exhibiting low volatility and high dividend yields. Quality is measured by profitability and leverage. Constituents are selected and weighted based on quality, volatility and yield characteristics. One may not invest directly in an index. |
| FTSE World Government Bond Non-USD Index | A broad index providing exposure to the global sovereign fixed income market, the index measures the performance of fixed-rate, local currency, investment-grade sovereign bonds. It comprises sovereign debt from over 20 countries, denominated in a variety of currencies. One may not invest directly in an index. |
| Fund of Funds (FOF) | A pooled investment fund that invests in other types of funds. |
| Fundamentals | The basic qualitative and quantitative information that contributes to the financial or economic well-being of a company, such as profitability, revenue, assets, liabilities and growth potential. |
| General Agreement on Tariffs and Trade (GATT) | A trade agreement intended to boost economic recovery after World War II through reconstructing and liberalizing global trade. Signed on October 30, 1947, by 23 countries, GATT was a legal agreement minimizing barriers to international trade by eliminating or reducing quotas, tariffs and subsidies while preserving significant regulations. |
| General Obligation (GO) Bond | A type of municipal bond that is backed entirely by the issuer's creditworthiness and ability to levy taxes on its residents. GO bonds are not backed by collateral and do not pay creditors back on the basis of income generated from funded projects. |
| Generative AI | A type of artificial intelligence technology that can produce various types of content, including text, imagery, audio and synthetic data. |
| Global Supply Chain Pressure Index (GSCPI) | An index that integrates a number of commonly used metrics with the aim of providing a comprehensive summary of potential supply chain disruptions. One may not invest directly in an index. |
| Goldman Sachs Financial Conditions Index | A weighted average of short-term interest rates, long-term interest rates, the trade-weighted dollar, an index of credit spreads and the ratio of equity prices to the 10-year average of earnings per share. One may not invest directly in an index. |
| Great Financial Crisis | A severe worldwide economic, banking and real estate crisis that occurred between 2007 and 2009. It was the most serious financial crisis since the Great Depression (1929). |
| Green Street Commercial Property Price Index (CPPI) | A time series of unleveraged US commercial property values that captures the prices at which commercial real estate transactions are currently being negotiated and contracted. Features that differentiate this index are its timeliness, its emphasis on high-quality properties, and its ability to capture changes in the aggregate value of the commercial property sector. One may not invest directly in an index. |
| Gross Fixed Capital Formation (GFCF) | The acquisition of produced assets (including purchases of second-hand assets), including the production of such assets by producers for their own use, minus disposals. |
| Gross Return (GR) | In relation to any index, approximates the maximum possible dividend reinvestment. The amount reinvested is the dividend distributed to individuals, but does not include tax credits. In relation to mutual funds, exchange-traded funds, and closed-end funds, refers to the total return including distributions prior to the deduction of fees and expenses. |
| Gross Value Added (GVA) | An economic productivity metric that measures the contribution of a corporate subsidiary, company or municipality to an economy, producer, sector or region. |
| Growth | As it relates to investing, an investment style and strategy that is focused on increasing an investor's capital. |
| Growth at a Reasonable Price (GARP) | An equity investment strategy that seeks to combine tenets of both growth investing and value investing to select individual stocks. |
| Growth Blended Benchmark (80% Equity) | A blended benchmark consisting of 56% Russell 3000 Index - TR / 24% Morningstar Global Markets ex-US Index - NR / 15% Bloomberg US Universal Index - TR / 3% FTSE WGBI Non-USD Index / 2% ICE BofAML Treasury 3 Month Index - TR. One may not invest directly in an index. |
| Guardrail Amount | The maximum deviation between the weightings of the specific securities in the Portfolio Reference Basket and the weightings of those specific securities in the Actual Portfolio, as well as between the weighting of the respective cash positions. The Guardrail Amount is intended to ensure that no individual security in the Portfolio Reference Basket will be overweighted or underweighted by more than the publicly disclosed percentage when compared to the actual weighting of each security within the Actual Portfolio as of the beginning of each trading day. The Guardrail Amount is designed to help investors evaluate the risk of tracking error, which is the degree to which the performance of the Portfolio Reference Basket deviates from the performance of the Actual Portfolio. |
| Hawkish | In relation to monetary policy, describes a more restrictive stance (when the Federal Reserve is hiking or intends to hike interest rates). |
| Headline Inflation | The raw inflation figure reported through the Consumer Price Index (CPI) that is released monthly by the Bureau of Labor Statistics which is derived from the cost to purchase a fixed basket of goods. |
| Headline Risk | The possibility that a news story will adversely affect the price of an investment, such as a stock or commodity. Headline risk can also impact the performance of a specific sector or the entire stock market. |
| Hedging | The use of financial instruments to protect against adverse price movements. |
| High Conviction | Active management focused on high confidence securities. |
| High Yield | Commonly referred to as “junk” or “junk bonds,” fixed income securities rated below investment grade (below BBB). High yield bonds pay higher interest rates because they have lower credit ratings than investment-grade bonds. |
| ICE Biotechnology Index | A rules-based, modified float-adjusted market capitalization-weighted index that tracks the performance of qualifying US listed biotechnology companies. One may not invest directly in an index. |
| ICE BofAML Treasury 3 Month Index | Measures the performance of a single issue of outstanding treasury bill which matures closest to, but not beyond, three months from the rebalancing date. One may not invest directly in an index. |
| Income & Growth Blended Benchmark (40% Equity) | A blended benchmark consisting of 28% Russell 3000 Index - TR / 12% Morningstar Global Markets ex-US Index - NR / 46% Bloomberg US Universal Index - TR / 9% FTSE WGBI Non-USD Index / 5% ICE BofAML Treasury 3 Month Index - TR. One may not invest directly in an index. |
| Income Strategies | The practice of managing exposure to higher income instruments or to instruments with complex income streams. |
| Index Estimated Earnings Next Year | Based on the BEst estimate for each member of the index. Calculated by summing all members' BEst EPS for FY2 times Shares in the Index, divided by the index divisor. |
| Indian Fiscal Year | The fiscal year in India runs from April through March with 1Q (the first quarter) being April-June and so on. |
| Indicated Yield | A forward-looking measure that is calculated by multiplying the most recent dividend by the number of dividends issued each year (producing the indicated dividend), and then dividing by the current share price. |
| Indxx Disruptive Technologies Index | Designed to track the performance of companies that are likely to disrupt an existing market and value network, displace established market leading firms, products and alliances and increasingly gain market share. One may not invest directly in an index. |
| Inflation Expectations | The rate at which people, including consumers, businesses and investors, expect prices to rise in the future. |
| Inflationary Recession | A period of temporary economic decline during which real GDP falls while nominal GDP rises. |
| Interest Coverage Ratio | A debt and profitability ratio used to determine how easily a company can pay interest on its outstanding debt. The interest coverage ratio is calculated by dividing a company's earnings before interest and taxes (EBIT) by its interest expense during a given period. |
| Intermodal | Containerized products and raw materials that are transported by a variety of modes such as shipping, road and rail. |
| Investment Grade (IG) | A rating that signifies that a municipal or corporate bond presents a relatively low risk of default. To be considered an investment grade issue, the company must be rated at 'BBB' or higher by Standard and Poor's or Moody's. Anything below this 'BBB' rating is considered non-investment grade. |
| ISM Manufacturing Inventories Index | A monthly indicator of US inventory levels. A reading over 50 shows inventories have risen from the previous month while a reading below 50 shows a decline in inventories. One may not invest directly in an index. |
| ISM Manufacturing New Orders Index | Shows the number of new orders from customers of manufacturing firms reported by survey respondents compared to the previous month. A reading over 50 shows orders have risen from the previous month while a reading below 50 shows a decline in orders. One may not invest directly in an index. |
| ISM Manufacturing PMI | Measures the change in production levels across the US Economy from month to month. One may not invest directly in an index. |
| ISM Manufacturing Report on Business Backlog of Orders Index | Surveyed data designed to determine if orders are more or less backlogged than the previous month. A reading above 50 indicates more backlog, and a reading below 50 indicates less backlog. One may not invest directly in an index. |
| ISM Manufacturing Report on Business Supplier Deliveries Index | Surveyed data designed to determine if suppliers are delivering faster or slower than the previous month. A reading above 50 indicated slower deliveries, and a reading below 50 indicates faster deliveries. One may not invest directly in an index. |
| ISM Services PMI | A composite index based on the diffusion indexes for four service economy indicators with equal weights: Business Activity (seasonally adjusted), New Orders (seasonally adjusted), Employment (seasonally adjusted) and Supplier Deliveries. One may not invest directly in an index. |
| J.P. Morgan Emerging Markets Bond Index Global (EMBI Global) | Tracks total returns for traded external debt instruments in the emerging markets. One may not invest directly in an index. |
| Kastle Back to Work Barometer | A measure of current average weekly (first time a day) swipe activity across a 10-city sample of commercial office buildings which utilize Kastle building security, compared to a weekly average from before office use dropped due to COVID-19. The 10-city sample includes: Houston, Chicago, Austin, New York, Dallas, Los Angeles, San Francisco, Washington D.C., San Jose and Philadelphia. |
| KBW Bank Index | Designed to track the performance of the leading banks and thrifts that are publicly-traded in the US. The Index includes 24 banking stocks representing the large US national money centers, regional banks and thrift institutions. One may not invest directly in an index. |
| Knock-on Effects | Secondary or cumulative effects from another event or circumstance. |
| Term | Definition |
|---|---|
| LBMA Gold Price Index | Measures the global spot price for gold. One may not invest directly in an index. |
| Liquidity | The degree to which an asset or security can be bought or sold in the market without affecting the asset's price. |
| M2 Money Supply | A measure of the money supply that includes cash, checking deposits and easily-convertible near money. |
| man Sachs Financial Conditions Index | A weighted average of short-term interest rates, long-term interest rates, the trade-weighted dollar, an index of credit spreads and the ratio of equity prices to the 10-year average of earnings per share. One may not invest directly in an index. |
| Market Price | Price based on the midpoint of the bid/ask spread at 4 p.m. ET and does not represent the returns an investor would receive if shares were traded at other times. |
| Master Limited Partnership (MLP) | A business venture that exists in the form of a publicly traded limited partnership. They combine the tax benefits of a private partnership - profits are taxed only when investors receive distributions - with the liquidity of a publicly traded company. |
| Maturity | The date on which the final payment is due on a debt instrument. |
| Max Drawdown (MDD) | A measure of an asset's largest price drop from a peak to a trough. Maximum drawdown is considered to be an indicator of downside risk, with large MDDs suggesting that down movements could be volatile. |
| Maximum Offering Price (MOP) | With front-load funds, the sum of the NAV and the sales charge per share. |
| Mean Reversion | A theory used in finance that suggests that asset price volatility and historical returns eventually will revert to the long-run mean or average level of the entire dataset. |
| Mergers and Acquisitions (M&A) | The area of corporate finances, management and strategy dealing with purchasing and/or joining with other companies. |
| Momentum (Market) | Refers to the inertia of a price trend to continue either rising or falling for a particular length of time, usually taking into account both price and volume information. |
| Money Flow (Inflows and Outflows) | Refers to cash that flows into and out of various financial assets for specific periods of time, where high inflows may reflect growing overall investor optimism, while high outflows may suggest increasing investor wariness. |
| Morningstar Categories | Classifications that break portfolios into peer groups based on their holdings. The categories help investors identify the top-performing funds, assess potential risk, and build well-diversified portfolios. |
| Morningstar China Index | Measures the performance of China's equity markets targeting the top 97% of stocks by market capitalization. One may not invest directly in an index. |
| Morningstar Developed Markets ex-North America Index | Measures the performance of companies in developed markets ex-North America. It covers approximately 97% of the full market capitalization in the Developed Markets ex-North America. One may not invest directly in an index. |
| Morningstar Developed Markets Index | Measures the performance of developed regional markets targeting the top 97% of stocks by market capitalization. One may not invest directly in an index. |
| Morningstar DM XUS Index | Tracks developed markets ex-US targeting the top 97% of stocks by market capitalization. One may not invest directly in an index. |
| Morningstar Emerging Markets Index | Captures the performance of the stocks located in the emerging countries across the world. Stocks in the index are weighted by their float capital, which removes corporate cross ownership, government holdings and other locked-in shares. One may not invest directly in an index. |
| Morningstar Global Markets ex-US Index | Designed to provide exposure to the top 97% market capitalization in each of two economic segments, developed markets, excluding the United States, and emerging markets. One may not invest directly in an index. |
| Morningstar Global Markets Index | Measures the performance of the stocks located in the developed and emerging countries across the world. Stocks in the index are weighted by their float capital, which removes corporate cross ownership, government holdings and other locked-in shares. One may not invest directly in an index. |
| Morningstar India Index | Measures the performance of India's equity markets targeting the top 97% of stocks by market capitalization. One may not invest directly in an index. |
| Morningstar Intermediate-Term Core Bond Category | Includes portfolios that invest primarily in investment-grade US fixed-income issues including government, corporate, and securitized debt, and hold less than 5% in below-investment-grade exposures. Their durations (a measure of interest-rate sensitivity) typically range between 75% and 125% of the three-year average of the effective duration of the Morningstar Core Bond Index. |
| Morningstar LSTA US Leveraged Loan 100 Index | Measures the performance of the 100 largest facilities in the US leveraged loan market. One may not invest directly in an index. |
| Morningstar Small Cap Index | Tracks the performance of US small-cap stocks. These stocks fall between the 90th and 97th percentile in market capitalization of the investable universe. In aggregate, the Small Cap Index represents 7 percent of the investable universe. One may not invest directly in an index. |
| Morningstar US 10+ Year Treasury Bond Index | Measures the performance of fixed-rate, investment-grade USD-denominated Treasury bonds with maturities greater than ten years. It is market-capitalization weighted. One may not invest directly in an index. |
| Morningstar US Growth Index | Measures the performance of US stocks that are expected to grow at a faster pace than the rest of the market as measured by forward earnings, historical earnings, book value, cash flow and sales. One may not invest directly in an index. |
| Morningstar US Large Blend Category | Includes portfolios that are fairly representative of the overall US stock market in size, growth rates, and price. These portfolios tend to invest across the spectrum of US industries. The blend style is assigned to portfolios where neither growth nor value characteristics predominate. |
| Morningstar US Large Cap Index | Measures the performance of US large-cap stocks. These stocks represent the largest 70 percent capitalization of the investable universe. One may not invest directly in an index. |
| Morningstar US Large Growth Index | Measures the performance of US large-cap stocks that are expected to grow at a faster pace than the rest of the market as measured by forward earnings, historical earnings, book value, cash flow and sales. One may not invest directly in an index. |
| Morningstar US Large Value Index | Measures the performance of US large-cap stocks with relatively low prices given anticipated per-share earnings, book value, cash flow, sales and dividends. One may not invest directly in an index. |
| Morningstar US Large-Mid Cap Broad Value Index | Designed to provide comprehensive, consistent representation of the large-mid cap value segment of the US equity market. One may not invest directly in an index. |
| Morningstar US Market Index | Measures the performance of US securities and targets 97% market capitalization coverage of the investable universe. It is a diversified broad market index. One may not invest directly in an index. |
| Morningstar US Mid-Cap Blend Category | Includes portfolios that invest in US stocks of various sizes and styles. The blend style is assigned to portfolios where neither growth nor value characteristics predominate. |
| Morningstar US Real Estate Category | Includes portfolios that invest primarily in companies that develop and manage real estate properties. Some portfolios in this category also invest in real estate operating companies. |
| Morningstar US Small Blend Category | Includes portfolios that favor US firms at the smaller end of the market-capitalization stage. The blend style is assigned to portfolios where neither growth nor value characteristics predominate. |
| Morningstar US Small-Cap Broad Value Extended Index | Designed to provide comprehensive, consistent representation of the small cap value segment of the US equity market. One may not invest directly in an index. |
| Morningstar US Value Index | Measures the performance of measures the performance of US stocks with relatively low prices given anticipated per-share earnings, book value, cash flow, sales and dividends. One may not invest directly in an index. |
| Mortgage-Backed Securities (MBS) | Bonds secured by home and other real estate loans. They are created when a number of these loans, usually with similar characteristics, are pooled together. |
| MSCI ACWI ex USA Index | Captures large and mid cap representation across 22 of 23 Developed Markets (DM) countries (excluding the US) and 24 Emerging Markets (EM) countries. With over 2,000 constituents, the index covers approximately 85% of the global equity opportunity set outside the US. One may not invest directly in an index. |
| MSCI EAFE High Dividend Yield Index | Based on the MSCI EAFE, its parent index, and includes large- and mid-cap representation across Developed Markets countries around the world, excluding the US and Canada. The index is designed to reflect the performance of equities in the parent index (excluding REITs) with higher dividend income and quality characteristics than average dividend yields that are both sustainable and persistent. One may not invest directly in an index. |
| MSCI EAFE Index | An equity index which captures large- and mid-cap representation across 21 developed markets countries around the world, excluding the US and Canada, covering approximately 85% of the free float-adjusted market capitalization in each country. One may not invest directly in an index. |
| MSCI EAFE Investable Market Index (IMI) | An equity index which captures large, mid and small cap representation across Developed Markets countries around the world, excluding the US and Canada. One may not invest directly in an index. |
| MSCI Emerging Markets (EM) Asia Index | Captures large and mid-cap representation across eight Emerging Market countries (China, India, Indonesia, Korea, Malaysia, the Philippines, Taiwan and Thailand) in Asia. With approximately 1,200 constituents, the index covers approximately 85% of the free float-adjusted market capitalization in each country. One may not invest directly in an index. |
| MSCI Emerging Markets (EM) EMEA Index | Captures large and mid-cap representation across 11 Emerging Market countries in Europe, Africa and the Middle East, including the Czech Republic, Egypt, Greece, Hungary, Poland, Qatar, Russia, Saudi Arabia, South Africa, Turkey and United Arab Emirates. One may not invest directly in an index. |
| MSCI Emerging Markets (EM) Latin America Index | Captures large and mid-cap representation across five Emerging Markets countries (Brazil, Mexico, Chile, Peru and Colombia) in Latin America. With approximately 100 constituents, the index covers approximately 85% of the free float-adjusted market capitalization in each country. One may not invest directly in an index. |
| MSCI Emerging Markets Index | Captures large and mid-cap representation across 24 Emerging Markets countries. With approximately 1,500 constituents, the index covers approximately 85% of the free float-adjusted market capitalization in each country. One may not invest directly in an index. |
| MSCI Europe Index | Captures large- and mid-cap representation across 15 Developed Markets (DM) countries in Europe. With 429 constituents, the index covers approximately 85% of the free float-adjusted market capitalization across the European Developed Markets equity universe. One may not invest directly in an index. |
| MSCI India Index | Designed to measure the performance of the large and mid-cap segments of the Indian market. With approximately 125 constituents, the index covers approximately 85% of the Indian equity universe. One may not invest directly in an index. |
| MSCI US IMI Real Estate 25/50 Index | Designed to capture the large, mid and small cap segments of the US equity universe. All securities in the index are classified in the Real Estate sector as per the Global Industry Classification Standard (GICS). The Index also applies certain investment limits to help ensure diversification - limits that are imposed on regulated investment companies, or RICs, under the current US Internal Revenue Code. One may not invest directly in an index. |
| MSCI USA Momentum Index | Captures large and mid-cap stocks of the US market and is designed to reflect the performance of an equity momentum strategy by emphasizing stocks with high price momentum, while maintaining reasonably high trading liquidity, investment capacity and moderate index turnover. One may not invest directly in an index. |
| MSCI USA Momentum SR Variant Index | Aims to reflect the performance of the MSCI USA Momentum Index, wherein all changes driven by the index rebalances of the MSCI USA Momentum Index are distributed over three days leading into the rebalancing effective date. One may not invest directly in an index. |
| MSCI USA Value Index | Captures large and mid-cap US securities exhibiting overall value style characteristics using three variables: book value to price, 12-month forward earnings to price and dividend yield. One may not invest directly in an index. |
| MSCI World ex USA Investable Market Index (IMI) | Captures large, mid and small cap representation across 22 of 23 Developed Markets countries, excluding the US. One may not invest directly in an index. |
| MSCI World Index | Measures the performance of equity markets across developed countries. One may not invest directly in an index. |
| MSCI World SMID Cap Index | Captures mid and small cap representation across developed countries. One may not invest directly in an index. |
| Municipal Bond | A debt security issued by a state, municipality, or county to finance its capital expenditures, including the construction of highways, bridges, or schools. They can be thought of as loans that investors make to local governments. Municipal bonds are often exempt from federal taxes and most state and local taxes (for residents), making them especially attractive to people in higher income tax brackets. |
| Term | Definition |
|---|---|
| NASDAQ 100 Index | One of the world’s preeminent large-cap growth indexes. It includes 100 of the largest domestic and international non-financial companies listed on the Nasdaq Stock Market based on market capitalization. One may not invest directly in an index. |
| NASDAQ Biotechnology Index | Designed to track the performance of a set of securities listed on The NASDAQ Stock Market (NASDAQ) that are classified as either biotechnology or pharmaceutical companies, and is a modified market capitalization weighted index. One may not invest directly in an index. |
| NASDAQ Clean Edge Green Energy Index | A modified market capitalization weighted index designed to track the performance of companies that are primarily manufacturers, developers, distributors and/or installers of clean energy technologies, as defined by Clean Edge. One may not invest directly in an index. |
| NASDAQ Composite Index | Measures the performance of all issues listed in the NASDAQ Stock Market, except for rights, warrants, units, and convertible debentures. One may not invest directly in an index. |
| NCREIF Fund Index - Open End Diversified Core Equity (NFI-ODCE Index) | An index of investment returns reporting on both a historical and current basis the results of 38 open-end commingled funds pursuing a core investment strategy. The NFI-ODCE Index is capitalization-weighted and is reported gross of fees. Measurement is time-weighted. NCREIF (National Council of Real Estate Investment Fiduciaries) will calculate the overall aggregated Index return. One may not invest directly in an index. |
| Net Asset Value (NAV) | The per-share dollar amount of the fund is derived by dividing the total value of all the securities in its portfolio, less any liabilities, by the number of fund shares outstanding. |
| Net Debt-to-EBITDA Ratio | A debt ratio that shows how many years it would take for a company to pay back its debt if net debt and EBITDA are held constant. |
| Net Present Value (NPV) | The difference between the present value of cash inflows and the present value of cash outflows over a period of time. |
| Net Return (NR) | In relation to any index, approximates the minimum possible dividend reinvestment. The dividend is reinvested after the deduction of withholding tax. |
| Net Total Return (NTR) | In relation to any index, assumes that income from the constituents is reinvested after a deduction is made for withholding taxes. |
| Net Yield | Defined by Bloomberg as the ratio of net dividends per share that have gone “ex” in the past 12 months and closing price, multiplied by 100, as of the date of analysis. |
| New Economy REITs | Equal weight blend, rebalanced monthly, FTSE NAREIT Equity Industrial Index TR, FTSE NAREIT Equity Data Centers Index TR, FTSE NAREIT Infrastructure REITs Index TR. |
| Nifty 500 Index | Represents the top 500 companies based on full market capitalization from the eligible universe. One may not invest directly in an index. |
| Nikkei 225 Index | Tracks the performance of the top 225 companies that are listed on the Tokyo Stock Exchange. One may not invest directly in an index. |
| Nominal | A measure before considering the impact of inflation. |
| Nominal Growth (or Current Dollar Growth) | Economic growth not adjusted for the price changes from inflation and deflation. |
| NYSE Biotechnology Index | A rules-based, modified float-adjusted market capitalization-weighted equity index that has the objective of measuring the performance of US-listed companies in the biotechnology sector. One may not invest directly in an index. |
| NYSE Equal Sector Weight Index | Consists of a strategy that holds all active Select Sector SPDR ETFs in an equal-weighted portfolio. One may not invest directly in an index. |
| O'Shares Europe Quality Dividend Index | Designed to reflect the performance of publicly-listed large-capitalization and mid-capitalization dividend-paying issuers in Europe that meet certain market capitalization, liquidity, high quality, low volatility and high dividend yield thresholds. The quality and low volatility requirements are designed to reduce exposure to high dividend equities that have experienced large price declines. One may not invest directly in an index. |
| O'Shares Global Internet Giants Index | A rules-based index intended to give investors a means of tracking stocks exhibiting quality and growth characteristics in the internet technology and e-commerce business segments and pass screens for gross margin and cash burn sustainability. Companies included in OGIGX derive at least 50% of their revenues from a) internet technology companies whose principal business is to provide the technologies that support internet commerce; and b) internet commerce companies whose principal business is to sell products and services via the internet. One may not invest directly in an index. |
| O'Shares US Quality Dividend Index | Designed to measure the performance of publicly-listed large-capitalization and mid-capitalization dividend-paying issuers in the United States that meet certain market capitalization, liquidity, high quality, low volatility and dividend yield thresholds. The high quality and low volatility requirements are designed to reduce exposure to high dividend equities that have experienced large price declines. One may not invest directly in an index. |
| O'Shares US Small-Cap Quality Dividend Index | Designed to reflect the performance of publicly-listed small-capitalization dividend paying issuers in the United States that meet certain market capitalization, liquidity, high quality, low volatility and dividend yield thresholds. The quality and low volatility requirements are designed to reduce exposure to high dividend equities that have experienced large price declines. One may not invest directly in an index. |
| OECD G20 LEI Diffusion Index | Reflects the proportion of countries whose composite leading indicators are rising or remain unchanged year over year. One may not invest directly in an index. |
| Old Economy REITs | Equal weight blend, rebalanced monthly, FTSE NAREIT Equity Apartments Index TR, FTSE NAREIT Equity Office Index TR, FTSE NAREIT Equity Retail Index TR. |
| One-Year Constant Maturity Treasury (CMT) | Represents the one-year yield of the most recently auctioned Treasury securities. |
| Option-Adjusted Spread (OAS) | The spread measures the difference in the yields of two debt instruments with different characteristics such as maturities or credit ratings. "Option-adjusted" refers to inclusion of call provisions in the securities, shortening their maturities. |
| Owner's Equivalent Rent (OER) | Amount of rent that would have to be paid in order to substitute a currently owned house as a rental property. Surveyed data. |
| Pacer US Small Cap Cash Cows Index | A strategy driven index that aims to provide capital appreciation over time by screening the S&P Small-Cap 600 Index for the top 100 small-cap companies based on free cash flow yield. One may not invest directly in an index. |
| Passive Management | The practice of following an index or other strategy that attempts to replicate returns of a segment of the investable market by holding many similar investments without regard for risk/return characteristics of the individual investments. |
| Personal Consumption Expenditures Price Index (PCE) | A measure of the prices that people living in the United States, or those buying on their behalf, pay for goods and services. The PCE is known for capturing inflation (or deflation) across a wide range of consumer expenses and reflecting changes in consumer behavior. One may not invest directly in an index. |
| Pitchbook North Americas Private Equity Index | An index to measure aggregate performance of private equity in North America, calculated quarterly as the total percentage change in NAV for funds in the Pitchbook private equity database, net of contributions and distributions. One may not invest directly in an index. |
| Pitchbook Private Equity Index | Compiled from private equity investors and limited partners, measures the quarterly net asset value change of the private equity funds in the Pitchbook universe, considering both contributions and distributions during the period. One may not invest directly in an index. |
| Premium/Discount | The amount (stated in dollars or percent) by which the selling or purchase price of an ETF is greater than (premium) or less than (discount) its face amount/value or net asset value (NAV). |
| Present Value | The current value of a future sum of money or stream of cash flows given a specified rate of return. Future cash flows are discounted at the discount rate, and the higher the discount rate, the lower the present value of the future cash flows. |
| Price Matters® | A discipline of the RiverFront Investment Group that compares inflation-adjusted current prices relative to their long-term trend to help identify extremes in valuation. |
| Price/Book (P/B) Ratio | The weighted average of the price/book ratios of all the stocks in a portfolio. The P/B ratio of a company is calculated by dividing the market price of its stock by the company's per-share book value. |
| Price/Cash Flow (P/CF) Ratio | Represents the weighted average of the price/cash flow ratios of the stocks in a portfolio. Price/cash flow represents the amount an investor is willing to pay for a dollar generated from a particular company's operations. |
| Price/Earnings (P/E) Ratio | A valuation ratio of a company's current share price compared to its per-share earnings. |
| Price/Earnings-to-Growth (PEG) Ratio | A valuation metric used for stocks. PEG builds on the P/E ratio by considering expected earnings growth and not just current earnings. A PEG ratio of under 1.0 can indicate a stock is undervalued and a potential buy. A PEG above 1.0 can indicate an overvalued stock. |
| Price/Free Cash Flow (P/FCF) Ratio | An equity valuation metric that compares a company's per-share market price to its free cash flow (FCF). This metric is very similar to the valuation metric of price/cash flow but uses free cash flow, which subtracts capital expenditures (CAPEX) from a company's total operating cash flow, thereby reflecting the actual cash flow available to fund non-asset-related growth. |
| Price/Funds from Operations (P/FFO) Ratio | A valuation ratio of a company's current share price compared to its per-share funds from operations. |
| Price/Sales (P/S) Ratio | Represents the weighted average of the price/sales ratios of the stocks in a portfolio. Price/sales represent the amount an investor is willing to pay for a dollar generated from a particular company's operations. |
| Producer Price Index (PPI) | A measure of the average change over time in the selling prices received by domestic producers for their output. One may not invest directly in an index. |
| Purchasing Managers' Index (PMI) | An index of the prevailing direction of economic trends in the manufacturing and service sectors. It consists of a diffusion index that summarizes whether market conditions, as viewed by purchasing managers, are expanding, staying the same, or contracting. One may not invest directly in an index. |
| Pure-Play | A company that focuses solely on one type of product or service. |
| Quality | In the context of investing, stocks of companies that have strong balance sheets, profitability and dividend stability. |
| Quantitative Easing | A monetary policy strategy used by central banks where they purchase securities in an attempt to reduce interest rates, increase the supply of money and drive more lending to consumers and businesses. |
| Quantitative Tightening | A monetary policy strategy used by central banks where they reduce the pace of reinvestment of proceeds from maturing government bonds in an attempt to raise interest rates, decrease the supply of money, and reduce lending to consumers and businesses. |
| Term | Definition |
|---|---|
| R-Squared | In investing, R-squared is generally interpreted as the percentage of a fund or security's movements that can be explained by movements in a benchmark index. An R-squared of 100% means that all movements of a security are completely explained by movements in the index. |
| Real | A measure after considering the impact of inflation. |
| Real Estate Investment Trust (REIT) | Companies that own or finance income-producing real estate across a range of property sectors. Listed REITs have characteristics of both the income potential of bonds and growth potential of stocks. |
| Real Gross Domestic Product (Real GDP) | An inflation-adjusted measure that reflects the value of all goods and services produced by an economy in a given year. |
| Real Growth | Economic growth adjusted for the price changes from inflation and deflation. |
| Realized Volatility | Sometimes referred to as the historical volatility. While the implied volatility refers to the market's assessment of future volatility, the realized volatility measures what actually happened in the past. |
| Recession | A period of temporary economic decline during which trade and industrial activity are reduced, generally identified by a fall in real GDP in two successive quarters. |
| Red Rocks Global Listed Private Equity Index | Comprised of 40-75 listed private equity companies and provides broad exposure to the growth and returns generated by hundreds of private companies. One may not invest directly in an index. |
| Refinitiv Equal Weight Commodity Total Return Index | A broad based commodity index that reflects the price movement of 17 exchange-traded futures contracts. The commodities are considered in equal-weights, which are maintained through daily arithmetic averaging. One may not invest directly in an index. |
| REIT Net Asset Value (NAV) | In real estate investing, the total value of a real asset, minus any outstanding debts and the costs of any other fixed or planned capital expenses. |
| Repo Rate | The discount rate at which a central bank repurchases government securities from commercial banks, depending on the level of money supply it decides to maintain in the country's monetary system. |
| Reshoring | The practice of transferring a business operation that was moved overseas back to the country from which it was originally relocated. |
| Return on Assets (ROA) | A financial ratio that indicates how profitable an investment is in relation to its total assets. |
| Return on Equity (ROE) | A measure of financial performance calculated by dividing net income by shareholders' equity. ROE is considered a gauge of profitability. |
| Return on Invested Capital (ROIC) | A calculation used to assess a company's efficiency in allocating capital to profitable investments. |
| Revenue Bond | A class of municipal bonds issued to fund public projects which then repay investors from the income created by that project. |
| Roll Yield | The amount of return generated in the futures market after an investor rolls a short-term contract into a longer-term contract and profits from the convergence of the futures price toward a higher spot or cash price. |
| Russell 1000 Growth Index | Measures the performance of the large-cap growth segment of the US equity universe. It includes those Russell 1000 companies with relatively higher price-to-book ratios, higher Institutional Brokers' Estimate System forecast medium term (2 year) growth and higher sales per share historical growth (5 years). One may not invest directly in an index. |
| Russell 1000 Index | An index of the largest 1000 US companies by market capitalization. One may not invest directly in an index. |
| Russell 1000 Value Index | Measures the performance of the large-cap value segment of the US equity universe. It includes those Russell 1000 companies with lower price-to-book ratios and lower expected growth values. One may not invest directly in an index. |
| Russell 2000 Index | Measures the performance of the small-cap segment of the US equity universe. One may not invest directly in an index. |
| Russell 2000 Value Index | Measures the performance of the small capitalization value sector of the US equity market. One may not invest directly in an index. |
| Russell 3000 Index | Measures the performance of the largest 3,000 US companies representing approximately 97% of the investable US equity market. One may not invest directly in an index. |
| Russell Microcap Index | Measures the performance of the microcap segment of the US equity market. One may not invest directly in an index. |
| S&P 1000 Index | Combines the S&P MidCap 400 and the S&P SmallCap 600 to form an investable benchmark for the mid- to small-cap segment of the US equity market. One may not invest directly in an index. |
| S&P 500 Banks Industry Index | A capitalization-weighted index designed to replicate performance of the Banking Industry of the S&P 500. One may not invest directly in an index. |
| S&P 500 Communication Services Sector Index | A capitalization-weighted index designed to replicate performance of the Communication Services Sector of the S&P 500. One may not invest directly in an index. |
| S&P 500 Consumer Discretionary Sector Index | A capitalization-weighted index designed to replicate performance of the Consumer Discretionary Sector of the S&P 500. One may not invest directly in an index. |
| S&P 500 Consumer Staples Sector Index | A capitalization-weighted index designed to replicate performance of the Consumer Staples Sector of the S&P 500. One may not invest directly in an index. |
| S&P 500 Energy Sector Index | A capitalization-weighted index designed to replicate performance of the Energy Sector of the S&P 500. One may not invest directly in an index. |
| S&P 500 Equal Weight Index | The equal-weight version of the widely-used S&P 500. The index includes the same constituents as the capitalization weighted S&P 500, but each company in the index is allocated a fixed weight. One may not invest directly in an index. |
| S&P 500 Financials Sector Index | A capitalization-weighted index designed to replicate the performance of the Financials sector of the S&P 500 Index. One may not invest directly in an index. |
| S&P 500 Financials Sector Index | Comprises those companies included in the S&P 500 that are classified as members of the GICS financials sector. One may not invest directly in an index. |
| S&P 500 Growth Index | A capitalization-weighted index containing the stocks from the S&P 500 Index with Growth characteristics. One may not invest directly in an index. |
| S&P 500 Health Care Sector Index | A capitalization-weighted index designed to replicate performance of the Health Care Sector of the S&P 500. One may not invest directly in an index. |
| S&P 500 High Dividend Index | Measures the performance of 80 high yield companies within the S&P 500 Index and is equally weighted to best represent the performance of this group, regardless of constituent size. One may not invest directly in an index. |
| S&P 500 Index | Widely regarded as the best single gauge of large-cap US equities. The index includes 500 leading companies and covers approximately 80% of available market capitalization. One may not invest directly in an index. |
| S&P 500 Industrials Sector Index | A capitalization-weighted index designed to replicate performance of the Industrials Sector of the S&P 500. One may not invest directly in an index. |
| S&P 500 Info Tech Sector Index | A capitalization-weighted index designed to replicate performance of the Info Tech Sector of the S&P 500. One may not invest directly in an index. |
| S&P 500 Information Technology Index | Comprises those companies included in the S&P 500 that are classified as members of the GICS information technology sector. One may not invest directly in an index. |
| S&P 500 Materials Sector Index | A capitalization-weighted index designed to replicate performance of the Materials Sector of the S&P 500. One may not invest directly in an index. |
| S&P 500 Pure Growth Index | A style-concentrated index designed to track the performance of stocks that exhibit the strongest growth characteristics by using a style-attractiveness-weighting scheme. One may not invest directly in an index. |
| S&P 500 Pure Value Index | A style-concentrated index designed to track the performance of stocks that exhibit the strongest value characteristics by using a style-attractiveness-weighting scheme. One may not invest directly in an index. |
| S&P 500 Real Estate Sector Index | A capitalization-weighted index designed to replicate performance of the Real Estate Sector of the S&P 500. One may not invest directly in an index. |
| S&P 500 Utilities Sector Index | A capitalization-weighted index designed to replicate performance of the Utilities Sector of the S&P 500. One may not invest directly in an index. |
| S&P 500 Value Index | A capitalization-weighted index containing the stocks from the S&P 500 Index with Value characteristics. One may not invest directly in an index. |
| S&P Biotechnology Select Industry Index | Comprises stocks in the S&P Total Market Index that are classified in the GICS biotechnology sub-industry. One may not invest directly in an index. |
| S&P Composite 1500 Index | Combines three leading indices, the S&P 500, the S&P MidCap 400, and the S&P SmallCap 600, to cover approximately 90% of US market capitalization. One may not invest directly in an index. |
| S&P CoreLogic Case-Shiller 20-City Composite City Home Price Index | Seeks to measures the value of residential real estate in 20 major US metropolitan areas: Atlanta, Boston, Charlotte, Chicago, Cleveland, Dallas, Denver, Detroit, Las Vegas, Los Angeles, Miami, Minneapolis, New York, Phoenix, Portland, San Diego, San Francisco, Seattle, Tampa and Washington, D.C. One may not invest directly in an index. |
| S&P Developed Ex-U.S. Broad Market Index (BMI) | A market capitalization weighted index that defines and measures the investable universe of publicly traded companies domiciled in developed countries outside the US. One may not invest directly in an index. |
| S&P Developed LargeMidCap Index | Combining the S&P Developed LargeCap and S&P Developed MidCap indices, the S&P Developed LargeMidCap comprises the stocks representing the top 85% of float-adjusted market cap in each developed country. One may not invest directly in an index. |
| S&P Emerging LargeMidCap Index | Combining the S&P Emerging LargeCap and S&P Emerging MidCap indices, the S&P Emerging LargeMidCap comprises the stocks representing the top 85% of float-adjusted market cap in each emerging country. One may not invest directly in an index. |
| S&P Energy Select Sector Index | Seeks to provide an effective representation of the energy sector of the S&P 500 Index which includes companies in the oil, gas and consumable fuel, energy equipment and services industries. One may not invest directly in an index. |
| S&P Global Natural Resources Index | Includes 90 of the largest publicly-traded companies in natural resources and commodities businesses that meet specific investability requirements, offering investors diversified and investable equity exposure across 3 primary commodity-related sectors: agribusiness, energy, and metals & mining. One may not invest directly in an index. |
| S&P GSCI Gold Index | A sub-index of the S&P GSCI, provides investors with a reliable and publicly available benchmark tracking The Commodity Exchange (COMEX) gold future. One may not invest directly in an index. |
| S&P GSCI Index | A broad-based, production weighted index of commodity futures designed to represent the global commodity market beta. One may not invest directly in an index. |
| S&P International Dividend Opportunity Index | Seeks to track 100 high-yielding common stocks from around the world excluding the US while meeting diversification, stability and tradability requirements. One may not invest directly in an index. |
| S&P MidCap 400 Index | Provides investors with a benchmark for mid-sized companies. The index is designed to measure the performance of 400 mid-sized companies, reflecting the distinctive risk and return characteristics of this market segment. One may not invest directly in an index. |
| S&P North American Natural Resources Index | A benchmark that represents US traded securities classified under the GICS energy and materials sector excluding the chemicals industry; and steel sub-industry. One may not invest directly in an index. |
| S&P Small-Cap 600 Index | Seeks to measure the small-cap segment of the US equity market. The index is designed to track companies that meet specific inclusion criteria to ensure that they are liquid and financially viable. One may not invest directly in an index. |
| S&P Technology Select Sector Index | Seeks to provide an effective representation of the technology sector of the S&P 500 Index which includes companies from technology hardware, storage, and peripherals; software; communications equipment; semiconductors and semiconductor equipment; IT services; and electronic equipment, instruments and components. One may not invest directly in an index. |
| S&P US REIT Index | Defines and measures the investable universe of publicly traded real estate investment trusts (REITs) domiciled in the United States. One may not invest directly in an index. |
| S&P/Case-Shiller US National Home Price Index | An index that measures US residential real estate prices, tracking changes in the value of residential real estate nationally. One may not invest directly in an index. |
| S-Network Developed Markets (ex-Americas) Index | Based on the World Bank High Income Countries. The selection criteria for the index also includes requirements for sector inclusion, primary exchange listing, minimum market capitalization, share price, average daily trading volume and other factors. One may not invest directly in an index. |
| S-Network Emerging Sector Dividend Dogs Index (EDOGX) | A rules-based index intended to give investors a means of tracking the overall performance of the highest dividend paying stocks in the S-Network Emerging Markets Liquid 500 Index, a universe of mainly large capitalization stocks domiciled in emerging markets on a sector-by-sector basis. Emerging market countries are countries that major international financial institutions, such as the World Bank, generally consider to be less economically mature than developed nations. One may not invest directly in an index. |
| S-Network Global Travel Index | A rules-based methodology developed by S-Network Global Indexes Inc., which is designed to identify exchange-traded stocks of companies that are materially engaged in the global travel industry, including four segments: Airlines & Airport Services; Hotels, Casinos, Cruise Lines; Booking & Rental Agencies; and Ancillary Beneficiaries, which is based on the research of the Index Provider. One may not invest directly in an index. |
| S-Network International Sector Dividend Dogs Index (IDOGX) | A portfolio of stocks derived from a universe of mainly large capitalization stocks domiciled in developed markets outside the Americas (the "S-Network Developed International Equity 1000 Index"). The IDOGX methodology selects the five stocks in each of the ten GICS sectors that make up the universe which offer the highest dividend yields as of the last trading day of November. The fifty stocks that are selected for inclusion in the portfolio are equally weighted. One may not invest directly in an index. |
| S-Network Medical Breakthroughs Index | Comprised of small and mid-cap stocks of biotechnology companies that have one or more drugs in either Phase II or Phase III of the US Food and Drug Administration ("FDA") clinical trials. One may not invest directly in an index. |
| S-Network REIT Dividend Dogs Index (RDOGX) | A portfolio of stocks derived from the S-Network US Composite REIT Index (SNREIT). The RDOGX methodology selects the five stocks in each of the nine segments that make up SNREIT which offer the highest dividend yields as of the last trading day of November. One may not invest directly in an index. |
| S-Network Sector Dividend Dogs Index (SDOGX) | A rules-based index intended to give investors a means of tracking the overall performance of the highest dividend paying stocks in the S-Network US Equity WR Large-Cap 500 Index on a sector-by-sector basis. One may not invest directly in an index. |
| S-Network US Composite REIT Index | A benchmark index for the Real Estate Investment Trust component of the US stock market. One may not invest directly in an index. |
| S-Network US Equity WR Large-Cap 500 Index | Includes the 500 largest US stocks by market capitalization. One may not invest directly in an index. |
| Savings Rate, Personal | Personal saving as a percentage of disposable personal income (DPI), frequently referred to as "the personal saving rate," is calculated as the ratio of personal saving to DPI. Personal saving is equal to personal income less personal outlays and personal taxes; it may generally be viewed as the portion of personal income that is used either to provide funds to capital markets or to invest in real assets such as residences. |
| Secular | Refers to market or trending activities that unfold over long time horizons, or that aren't influenced by short-term factors and are likely to continue moving in the same general direction for the foreseeable future. |
| Self-Amortizing Loan | A loan for which the periodic payments, consisting of both principal and interest, are made on a predetermined schedule, ensuring that the loan will be paid off by the end of an agreed-upon term. |
| Sentiment (Investor or Market) | Refers to the overall attitude of investors toward a particular security or financial market. Rising prices indicate bullish sentiment, while falling prices indicate bearish sentiment. |
| Sharpe Ratio | A measure that indicates the average return minus the risk-free return divided by the standard deviation of return on an investment. |
| Shelter Component of Consumer Price Index (CPI) | Composed of four separate line items: owners’ equivalent rent (OER); rent of primary residence; lodging away from home; and tenants’ and household insurance. The two most critical components are the OER (>23% CPI weighting) and rent of primary residence (>7% CPI weighting). One may not invest directly in an index. |
| Short Duration Bond | Generally, a bond with maturity of less than five years. |
| Short End of Yield Curve | Generally debt instruments with maturities less than two years. |
| Spread | The difference in the yields of two debt instruments with different characteristics such as maturities or credit ratings. |
| Standard Deviation | A statistical measure that indicates the extent of deviation for a group as a whole. |
| Steepening | In regards to the yield curve - when longer-term interest rates increase relative to shorter-term interest rates. |
| Suboptimal | A solution or outcome that is below the best possible level or standard. |
| SummerHaven Dynamic Commodity Index | An innovative approach to commodity investing that uses fundamental signals about underlying physical markets to create an active benchmark for commodity futures investors. One may not invest directly in an index. |
| Term | Definition |
|---|---|
| Tailwind | A certain situation or condition that may lead to higher profits, revenue or growth. |
| Taxable-Equivalent Yield | The return that a taxable bond would need to yield in order to equal the yield on a comparable tax-exempt bond, such as a municipal bond. |
| Thematic Alpha | The excess return of an investment relative to the return of a benchmark index that can be attributed to thematic investment strategies. |
| Thematic ETF | An exchange-traded fund that invests in a specific theme or trend. |
| Thematic Investing | Designed to participate in longer term technological disrupters, economic and political developments and social trends. |
| There is No Alternative (TINA) | A term recently used as justification for purchasing equity securities at high valuations, referencing the sentiment that any other option is significantly less desirable. |
| Tightening Cycle | The period during which the Federal Reserve purposefully raises interest rates. |
| Tightening Mode | Tight, or contractionary monetary policy is a course of action undertaken by a central bank such as the Federal Reserve to slow down overheated economic growth, to constrict spending in an economy that is seen to be accelerating too quickly, or to curb inflation when it is rising too fast. |
| Tilts | Minor adjustments to the allocation. |
| Total Return (TR) | In relation to any index, includes performance of both capital gains as well as dividends reinvested. In relation to mutual funds, exchange-traded funds, and closed-end funds, includes both capital gains and distributions and deduction of expenses. |
| Tracking Error | A measure of the risk in an investment portfolio that is due to active management decisions made by the portfolio manager; it indicates how closely a portfolio follows the index to which it is benchmarked. |
| Trailing Twelve Month Yield | Refers to the percentage of income a portfolio has returned to investors over the last 12 months. |
| Travel Price Index (TPI) | Measures the cost of travel away from home in the United States. It is based on the US Department of Labor price data collected for the monthly Consumer Price Index (CPI). One may not invest directly in an index. |
| Twenty Equipment Unit (TEU) | A shipping container whose internal dimensions measure 20 feet long, 8 feet wide and 8 feet tall. |
| Unhedged | In relation to any index, includes international investments that are fully exposed to the risk of currency fluctuations. More generally, refers to an investment's full exposure to adverse price movements (i.e. a lack of hedging). |
| Up Capture | A statistical measure of an investment manager's relative performance during bull (up) markets. |
| Upgrade/Downgrade Ratio (Bonds) | A bond is upgraded or downgraded when rating agencies raise or lower a bond's rating. Bond ratings are changed for several reasons, such as a change in outlook or risk. Bond prices tend to go up when ratings rise and down when ratings drop. Similarly, when bond prices go up, yields go down. |
| US 3-Month T-Bill | US Treasury bills maturing in 0 to 3 months. |
| US Dollar Index | Measures the value of the US dollar relative to a basket of foreign currencies. One may not invest directly in an index. |
| US Oil and Gas Rig Count | Baker Hughes US Oil and Gas Rotary Rig Count. To be counted as active, a rig must be on location and drilling. |
| US Oil Reserves | Department of Energy Product Inventory Total, including the Strategic Petroleum Reserve (DOESISPR Index). |
| US Personal Consumption Expenditures Services Index | A measure of the prices that people in the US pay for services. One may not invest directly in an index. |
| US Treasury Bond (T-Bonds) | Government debt securities issued by the US Federal government that have maturities greater than 20 years. T-bonds earn periodic interest until maturity, at which point the owner is also paid a par amount equal to the principal. |
| US Treasury Yield | The yield that the US government pays investors that purchase a specific security. |
| Value | The monetary, material, or assessed worth of an asset, good or service. In relation to investing, a style or strategy focused on selecting stocks that appear to be trading below their intrinsic value. |
| Value Trap | An investment that appears to be cheaply priced because it has been trading at low valuation metrics but continues to fall in price. |
| Volatility | Generally refers to changes in asset price over certain time periods. High/low volatility refers to large/small changes in price respectively. |
| Wage-Price Spiral | A feedback loop between wages and prices which can drive higher inflation in a persistent manner. Once the economy enters the spiral, workers bid up nominal wages more than prices, prompting firms to raise prices further. |
| WCI Shanghai to Los Angeles Container Freight Benchmark Rate | Spot (current) container freight rates for standard-sized 40-foot container from Shanghai, China, to Los Angeles, CA. Weekly. |
| Wholesale Price Index (WPI) | Measures change in the overall price of goods before they are sold at retail. One may not invest directly in an index. |
| WilderHill Clean Energy Index | A modified equal dollar weighted index comprised of publicly traded companies whose businesses stand to benefit substantially from societal transition toward the use of cleaner energy and conservation. One may not invest directly in an index. |
| WisdomTree U.S. SmallCap Quality Dividend Growth Index | A fundamentally weighted index that consists of the small-capitalization segment of dividend-paying stocks with growth characteristics. One may not invest directly in an index. |
| Year-over-Year (YoY) | Describes a percentage change data point determined by subtracting a data point from one year ago from the current data point and dividing by the data point from one year ago. |
| Yield | Refers to how much income an investment generates, separate from the principal. Yield is the interest payments on a bond or dividend payments on a stock divided by the market value of the investment. |
| Yield Company (YieldCo) | Publicly traded companies that are focused on returning cash flows generated from renewable energy assets to shareholders. These assets largely consist of solar and wind farms that have entered into long-term energy delivery contracts with customers. |
| Yield Curve | A graphical representation of the yields (y-axis) on debt instruments with different maturities (x-axis). |
| Yield Curve Strategies/Positioning | The practice of managing exposure to instruments of varying maturities (see Yield Curve definition). |
| Yield to Maturity (YTM) | The percentage rate of return for a bond assuming that the investor holds the asset until its maturity date. It is the sum of all of its remaining coupon payments. A bond's yield to maturity rises or falls depending on its market value and how many payments remain to be made. |
| Yield-to-Worst (YTW) | A measure of the lowest possible yield that can be received on a bond that fully operates within the terms of its contract without defaulting. |
| Z-Score | A numerical measurement that describes a value's relationship to the mean of a group of values, measured as standard deviations from the mean. If a Z-score is 0, it indicates that the data point's score is identical to the mean score. A Z-score of 1.0 would indicate a value that is one standard deviation from the mean. |