We believe a glossary is key for any client trying to navigate through the range of complex terms and jargon in our industry.
Our most frequently defined terms are defined below but if there's something you think we should add, please contact us.
Undertakings for Collective Investments in Transferable Securities (UCITS)
The UCITS legislation governs how a fund can be marketed within the European Union and is designed to allow cross border fund sales to investors of different nationalities. To obtain UCITS status a fund must invest within defined but wide parameters.
Exposure to a specific asset (or asset class) which is lower than the proportion it represents in the market index or benchmark against which the portfolio is measured. Investment managers may take underweight positions in shares or sectors they expect to underperform in order to add value to the portfolio.
A pooled fund that is established under trust. If there is a demand for units, the manager will create more units for sale to investors. If investors wish to redeem their units, the manager will buy them back and cancel them.
A debt obligation with no collateral and backed only by the debtor’s creditworthiness.