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Passive investment strategy |
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Definition of Passive investment strategyPassive investment strategySee: passive management.
Related Terms:Buy-and-hold strategyA passive investment strategy with no active buying and selling of stocks from the Active portfolio strategyA strategy that uses available information and forecasting techniques to seek a Barbell strategyA strategy in which the maturities of the securities included in the portfolio are concentrated Bullet strategyA strategy in which a portfolio is constructed so that the maturities of its securities are highly Business Expansion InvestmentThe use of capital to create more money through the addition of fixed assets or through income producing vehicles. capital investment analysisRefers to various techniques and procedures Capital InvestmentsMoney 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. ![]() Combination strategyA strategy in which a put and with the same strike price and expiration are either both compensation strategya foundation for the compensation plan that addresses the role compensation should play in the organization confrontation strategyan 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 strategya plan to achieve the position in a Covered call writing strategyA strategy that involves writing a call option on securities that the investor Dedication strategyRefers to multi-period cash flow matching. differentiation strategya 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 Dividend reinvestment plan (DRP)Automatic reinvestment of shareholder dividends in more shares of a Equity investmentThrough equity investment, investors gain part ownership of the corporation. The primary type of equity investment is corporate stock. ![]() Expected return on investmentThe 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 opportunitiesThe options to identify additional, more valuable investment opportunities 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. Guaranteed investment contract (GIC)A pure investment product in which a life company agrees, for a Immunization strategyA bond portfolio strategy whose goal is to eliminate the portfolio's risk against a Import-substitution development strategyA development strategy followed by many Latin American InvestmentThe commitment of funds (capital) in anticipation of an increased Investment analystsRelated: financial analysts Investment bankFinancial intermediaries who perform a variety of services, including aiding in the sale of Investment BankerMiddleman 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. ![]() investment centera responsibility center in which the manager Investment centreA division or unit of an organization that is responsible for achieving an adequate return on investment decisiona judgment about which assets will be Investment decisionsDecisions concerning the asset side of a firm's balance sheet, such as the decision to investment gradeBonds rated Baa or above by Moody’s or BBB or above by Standard & Poor’s. Investment grade bondsA bond that is assigned a rating in the top four categories by commercial credit Investment incomeThe revenue from a portfolio of invested assets. Investment managerAlso 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 SpendingExpenditures on capital goods including new housing. Financial ''investments" and sales of existing assets are not included. Investment tax creditProportion of new capital investment that can be used to reduce a company's tax bill Investment Tax CreditA reduction in taxes offered to firms to induce them to increase investment spending. Investment trustA closed-end fund regulated by the investment Company Act of 1940. These funds have a Investment valueRelated:straight value. InvestmentsAs a discipline, the study of financial securities, such as stocks and bonds, from the investor's Ladder strategyA bond portfolio strategy in which the portfolio is constructed to have approximately equal Legal investmentsinvestments that a regulated entity is permitted to make under the rules and regulations Mutually exclusive investment decisionsinvestment decisions in which the acceptance of a project Net investmentGross, or total, investment minus depreciation. Net Investmentinvestment spending minus depreciation. Net present value of future investmentsThe present value of the total sum of NPVs expected to result from Overlay strategyA strategy of using futures for asset allocation by pension sponsors to avoid disrupting the Passive investment managementBuying a well-diversified portfolio to represent a broad-based market Passive portfolioA market index portfolio. Passive portfolio strategyA strategy that involves minimal expectational input, and instead relies on postinvestment auditthe process of gathering information Protective put buying strategyA strategy that involves buying a put option on the underlying security that is qualified investments (Canada)Qualified investments is the term used for investments that can be held in an RSP. These investments generally include: Randomized strategyA strategy of introducing into the decision-making process a random element that is 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. reinvestment assumptionan 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 Reinvestment rateThe rate at which an investor assumes interest payments made on a debt security can be Reinvestment riskThe 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 investmenta ratio that relates income generated Return on investment (ROI)Generally, book income as a proportion of net book value. 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. Return on investment (ROI)The net profit after tax as a percentage of the shareholders’ investment in the business. return on investment (ROI)A very general concept that refers to some Short-term investment servicesServices that assist firms in making short-term investments. Spread strategyA strategy that involves a position in one or more options so that the cost of buying an Stock replacement strategyA strategy for enhancing a portfolio's return, employed when the futures strategythe link between an organization’s goals and objectives Structured portfolio strategyA strategy in which a portfolio is designed to achieve the performance of some Underinvestment problemThe mirror image of the asset substitution problem, wherein stockholders refuse Unit investment trustMoney invested in a portfolio whose composition is fixed for the life of the fund. Zero-investment portfolioA portfolio of zero net value established by buying and shorting component Related to : financial, finance, business, accounting, payroll, inventory, investment, money, inventory control, stock trading, financial advisor, tax advisor, credit. |