|Passive investment strategy|
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Definition of Passive investment strategy
Passive investment strategy
See: passive management.
A passive investment strategy with no active buying and selling of stocks from the
Active portfolio strategy
A strategy that uses available information and forecasting techniques to seek a
A strategy in which the maturities of the securities included in the portfolio are concentrated
A strategy in which a portfolio is constructed so that the maturities of its securities are highly
A strategy in which a put and with the same strike price and expiration are either both
Covered call writing strategy
A strategy that involves writing a call option on securities that the investor
Refers to multi-period cash flow matching.
Dividend reinvestment plan (DRP)
Automatic reinvestment of shareholder dividends in more shares of a
Expected return on investment
The return one can expect to earn on an investment. See: capital asset
Foreign direct investment (FDI)
The acquisition abroad of physical assets such as plant and equipment, with
Future investment opportunities
The options to identify additional, more valuable investment opportunities
Guaranteed investment contract (GIC)
A pure investment product in which a life company agrees, for a
A bond portfolio strategy whose goal is to eliminate the portfolio's risk against a
Import-substitution development strategy
A development strategy followed by many Latin American
Related: financial analysts
Financial intermediaries who perform a variety of services, including aiding in the sale of
Decisions concerning the asset side of a firm's balance sheet, such as the decision to
Investment grade bonds
A bond that is assigned a rating in the top four categories by commercial credit
The revenue from a portfolio of invested assets.
Also called a portfolio manager and money manager, the individual who manages a
Investment product line (IPML)
The line of required returns for investment projects as a function of beta
Investment tax credit
Proportion of new capital investment that can be used to reduce a company's tax bill
A closed-end fund regulated by the investment Company Act of 1940. These funds have a
As a discipline, the study of financial securities, such as stocks and bonds, from the investor's
A bond portfolio strategy in which the portfolio is constructed to have approximately equal
investments that a regulated entity is permitted to make under the rules and regulations
Mutually exclusive investment decisions
investment decisions in which the acceptance of a project
Gross, or total, investment minus depreciation.
Net present value of future investments
The present value of the total sum of NPVs expected to result from
A strategy of using futures for asset allocation by pension sponsors to avoid disrupting the
Passive portfolio strategy
A strategy that involves minimal expectational input, and instead relies on
Passive investment management
Buying a well-diversified portfolio to represent a broad-based market
A market index portfolio.
Protective put buying strategy
A strategy that involves buying a put option on the underlying security that is
A strategy of introducing into the decision-making process a random element that is
The rate at which an investor assumes interest payments made on a debt security can be
The risk that proceeds received in the future will have to be reinvested at a lower potential
REIT (real estate investment trust)
Real estate investment trust, which is similar to a closed-end mutual
REMIC (real estate mortgage investment conduit)
A pass-through tax entity that can hold mortgages
Return on investment (ROI)
Generally, book income as a proportion of net book value.
Short-term investment services
Services that assist firms in making short-term investments.
A strategy that involves a position in one or more options so that the cost of buying an
Stock replacement strategy
A strategy for enhancing a portfolio's return, employed when the futures
Structured portfolio strategy
A strategy in which a portfolio is designed to achieve the performance of some
The mirror image of the asset substitution problem, wherein stockholders refuse
Unit investment trust
Money invested in a portfolio whose composition is fixed for the life of the fund.
A portfolio of zero net value established by buying and shorting component
RETURN ON INVESTMENT (ROI)
In its most basic form, the rate of return equals net income divided by the amount of money invested. It can be applied to a particular product or piece of equipment, or to a business as a whole.
A division or unit of an organization that is responsible for achieving an adequate return on
Return on investment (ROI)
The net profit after tax as a percentage of the shareholders’ investment in the business.
capital investment analysis
Refers to various techniques and procedures
return on investment (ROI)
A very general concept that refers to some
The commitment of funds (capital) in anticipation of an increased
a foundation for the compensation plan that addresses the role compensation should play in the organization
an organizational strategy in which company management decides to confront, rather than avoid, competition; an organizational strategy in which company management still attempts to differentiate company
cost leadership strategy
a plan to achieve the position in a
a technique for avoiding competition by distinguishing a product or service from that of competitors through adding sufficient value (including quality and/or features) that customers are willing to pay
a responsibility center in which the manager
a judgment about which assets will be
the process of gathering information
an assumption made about the rates of return that will be earned by intermediate cash flows from a capital project; NPV and PI assume reinvestment at the discount rate; IRR assumes reinvestment at the IRR
return on investment
a ratio that relates income generated
the link between an organization’s goals and objectives
Bonds rated Baa or above by Moody’s or BBB or above by Standard & Poor’s.
Middleman between a corporation issuing new securities and the public. The middleman buys the securities issue outright and then resells it to customers. Also called an underwriter.
Expenditures on capital goods including new housing. Financial ''investments" and sales of existing assets are not included.
Investment Tax Credit
A reduction in taxes offered to firms to induce them to increase investment spending.
investment spending minus depreciation.
Business Expansion Investment
The use of capital to create more money through the addition of fixed assets or through income producing vehicles.
Money used to purchase fixed assets for a business, such as land, buildings, or machinery. Also, money invested in a business on the understanding that it will be used to purchase permanent assets rather than to cover day-to-day operating expenses.
guaranteed investment certificate (GIC)
A GIC is an investment that gives you a guaranteed rate of return over a fixed period of time, usually between 30 days and 5 years. GICs are available from banks, trust companies, and other financial institutions.
qualified investments (Canada)
Qualified investments is the term used for investments that can be held in an RSP. These investments generally include:
Regular Investment Plan (RIP)
A plan under which you may make regular deposits of the same amount to your Mutual Funds account once a month, once every 2 weeks, or once a week. You can also make regular deposits up to four times a month on any dates you choose.
Through equity investment, investors gain part ownership of the corporation. The primary type of equity investment is corporate stock.
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