Absolute Return Objective |
Absolute return funds aim to make a positive return whether markets are rising or falling. They aim to do this by holding shares (“long”) positions but also by using derivatives to hold negative or “short” positions which profit from falling prices. This combination means that they will often perform better than long-only funds in falling markets but in rising markets they are likely to have lower long exposure and will profit less from the upside. |
Accumulation |
A share class which accumulates and reinvests net investment income and net realised capital gains and does not pay dividends. |
Authorised Corporate Director (ACD) |
A UK term for the operator of a UK OEIC. Waystone Management UK is the operator of the WS Blue Whale Growth Fund. |
Active Management |
When managers actively pick investments in an effort to outperform a benchmark, usually a market index. |
Administrator |
A specialist service provider who normally provides fund valuation services and accounting and maintains the register of shareholders. |
Annual Management Charge (AMC) |
Paid to the Investment Manager (normally calculated daily and paid monthly in arrears). |
Asset Allocation |
The process of dividing investments among asset classes, geographies or industry sectors to optimise the balance between risk and reward based on investment needs and risk tolerance. |
Asset Class |
A broad category of assets such as cash, equities (company shares - also known as stocks), fixed income securities (bonds) and property. |
Assets Under Management (AUM) |
The total of all investments, including cash, which are managed by a fund manager for its customers. The term is also used for the total within a specific fund. |
Average Market Capitalisation |
The average market capitalisation of a fund's equity portfolio gives you a measure of the size of the companies in which the fund invests. Market capitalisation is calculated by multiplying the number of a company's shares outstanding by its price per share. |