GLOSSARY

This glossary will help you better understand the terms used in the financial services industry.

Bespoke Services – individually or custom made product or service.

Bonds – A debt instrument created for the purpose of raising capital for a fixed period of time at a variable or fixed interest rate.

Capital Gains Tax – tax levied on capital gains, profits an investor realises when he sells a capital asset for a price that is higher than the purchase price.

Cash Equivalents (money market) – the most liquid current assets found on a business’s balance sheet eg. currency, petty cash.

Client Testimonials – Written recommendation from a customer affirming the performance, quality, and/or value of a product or service. 

Collective Investment Scheme (CIS) – different investors put their money together or pool their money into a portfolio, and then this pooled money is managed by professional investment managers.

Consumer Price Index (CPI) – measures monthly changes in prices for a range of consumer products.

Disability Cover – Disability insurance offers income protection to individuals who become disabled for a long period of time, and as a result can no longer work during that time period.

Dividend Withholding Tax – is a government requirement for the payer of an item of income (interest or dividends) to withhold or deduct tax from the payment, and pay that tax to the government.

Dread Disease Cover – the insurer is contracted to typically make a lump sum cash payment if the policyholder is diagnosed with one of the specific illnesses on a predetermined list 

Employee & Group Benefits –  includes various types of non-wage compensation provided to employees in addition to their normal wages or salaries.

Equities – the word equity is used when referring to an ownership interest in a business.

Estate Planning – preparing for the transfer of a person’s wealth and assets after his or her death.

Fees a payment made to a professional person or to a professional or public body in exchange for advice or services.

Financial Markets – The financial market is a broad term describing any marketplace where there is trading of securities including equities, bonds, currencies and derivatives.

Foreign Exchange – the exchange of one currency for another by governments, businesses and residents in two different countries.

Fund of Funds (FOF) – an investment strategy in which a fund invests in other types of funds.

Gross Domestic Product (GDP) – total value of goods produced and services provided in a country during one year.

Inflation Rate – rate at which the general level of prices for goods and services is rising and, consequently, the purchasing power of currency is falling.

Life Cover – insurance providing for the payment of a specified sum to a named beneficiary on the death of the policyholder.

Linked Investment Service Provider (LISP) – is a company that enables you to invest in a wide range of collective investment schemes, such as unit trust funds, via one source. … You own the units in a direct investment, otherwise they are owned by the retirement fund or insurer.

Management Company – a company which is set up to manage a group of properties, a unit trust, an investment fund, etc

Multi Manager Funds – each specialized fund may invest across different sectors and markets, or having managers investing in the same asset class but have different investment styles.

Net Asset Value (NAV) – is the value of an entity’s assets minus the value of its liabilities, often in relation to open-end or mutual funds. 

Payroll Administration – administration of the financial record of employees’ salaries, wages, bonuses, net pay, and deductions.

Personal Risk Insurance – insurance of human life values against the risks of death, injury, illness or against expenses incidental to the latter.

Portfolio Managers – a person who makes investment decisions using money, other people or institutions that have been placed under his or her control.

Repurchase (Repo) Rate – the rate at which the central bank of a country lends money to commercial banks in the event of any shortfall of funds. Repo rate is used by monetary authorities to control inflation.

Retirement Planning – planning that individuals do to prepare for life after paid work ends, not just financially but all aspects of life.

Statutory Body – an organization with the authority to check that another organization’s actions are legal. It is typically set up by a government or parliament.

Total Expense Ratio (TER) – is a measure of the total cost of a fund to the investor.  It may include various fees (purchase, redemption, auditing) and other expenses.

Yield – is the income return on an investment,