Glossary of terms

A measure of the total costs of operating a fund as a percentage of average total assets.

A professionally managed portfolio of securities that pools the assets of individuals and organisations to invest toward a common objective such as producing current income or long-term growth. Also known as a managed investment schemes, managed funds or units trusts.

The risk that a particular fund manager will under-perform.

A type of loan available from various financial institutions allowing investors to borrow cash against the value of listed shares or units in managed investments. A type of gearing.

Tax rates that have to be paid on any additional dollars of taxable income earned.  Income is taxed at the rate applicable in each band. As income rises, so des the tax rate. Also referred to as "tax brackets".

A business cycle concerned specifically with rises and falls in market activity, as measured by an index. Market cycles generally correspond to the economic clock, with periods of heavy purchasing indicating growth, and periods of heavy selling indicating recession.

The risk of major movements in value within a particular asset class.

A (potentially dangerous) strategy of buying or selling securities in anticipation of changes in market or economic conditions.

In investments, medium-term generally represents a period of three to five years.

A managed investment where investments are made across a range of asset classes. They usually include investments in shares, property, fixed interest securities and cash. Also known as diversified funds.