Glossary

Terms  Definitions
12 b-1 Fee Fee assessed by a mutual fund to cover advertising and promotion expenses. It is assessed against the net assets of the fund, so all fund shareholders pay it. A 12b-1 fund must be registered with the Securities and Exchange Commission (SEC), and the charge must be disclosed in the fund's prospectus.
3 Month LIBOR in USD Represents the interest rate at which major global banks are prepared to lend to one another in American dollars with a maturity of 3 months. The rate is calculated and published each day by the Intercontinental Exchange.
30-Day Dividend Yield The 30-day dividend yield represents the average daily dividends for the 30-day period, annualized and divided by the net asset values per share at the end of the period.
30-Day Median Bid/Ask Spread 30-day median bid/ask spread reflects the median of the difference between the best bid and offer as of the end of each 10-second interval during each trading day of the last 30 calendar days (or since inception, if shorter).
30-Day SEC Standardized Yield The 30-day SEC yield represents net investment income earned by a fund over a 30-day period, expressed as an annual percentage rate based on the fund's share price at the end of the 30-day period. The formula for calculating this yield is specified by the U.S. Securities and Exchange Commission (SEC) and assumes all portfolio securities are held until maturity. The formula translates the bond fund's current portfolio income into a standardized yield for reporting and comparison purposes.
30-Day SEC Yield With Waivers 30-day SEC yield with waivers means the yield takes into account a fund’s expense reduction, and reflects an estimated yield to maturity. It should be regarded as an estimate of the fund’s rate of investment income, and it may not equal the fund’s actual income distribution rate, which reflects a fund’s past dividends paid to shareholders. The 30-day SEC yield with waivers is calculated in accordance with SEC standards.
30-Day SEC Yield Without Waivers 30-day SEC yield without waivers means the yield does not take into account a fund’s expense reduction, and reflects an estimated yield to maturity. It should be regarded as an estimate of the fund’s rate of net investment income, and it may not equal the fund’s actual income distribution rate, which reflects a fund’s past dividends paid to shareholders. The 30-day SEC yield without waivers is calculated in accordance with SEC standards.
7-day Annualized Yield A method of calculating a money fund's yield by annualizing the fund's net investment income for the last seven days of each period divided by the fund's net asset value at the end of the period.
Active Management Actively managed funds are investment strategies that are directly managed by a manager or team of managers who select securities with the intention of beating their intended market index or benchmark. 
Active Share Active share represents the portion of portfolio holdings that differ from an index.
Active Weight Active weight reflects over/under relative to an index.
After-Tax Returns The returns presented reflect the return before taxes, the return after taxes on dividends and capital gain distributions, and the return after taxes on dividends, capital gain distributions, and gains (or losses) from the redemption of shares held for 1-, 5-, and 10-year or since-inception periods as applicable. After-tax returns reflect the highest federal income tax rate but exclude state and local taxes. The after-tax returns reflect the rates applicable to ordinary and qualified dividends and capital gains effective in 2003. During periods when the fund incurs a loss, the post-liquidation after-tax return may exceed the fund's other returns because the loss generates a tax benefit that is factored into the result. An investor's actual after-tax return will likely differ from those shown and depend on his or her tax situation. Past before- and after-tax returns do not necessarily indicate future performance.
Allocation Effect Measures how much of the portfolio's return relative to its benchmark is due to the manager's decisions to over- and under-weight specific segments.
Alpha Alpha is the excess return of an investment relative to its benchmark.
Positive alpha means outperformance of an investment relative to its benchmark.
Animal Spirits Animal Spirits refers to how individuals come to financial decisions during times of economic uncertainty.
Annual Rate of Return Annual rate of return is the annual rate of gain or loss on an investment expressed as a percentage. 
Annualized Std. Deviation This indicates the volatility of a portfolio's total returns as measured against its mean performance. Unlike alpha and beta, which are relative to a benchmark index, standard deviation is an absolute measure. In general, the higher the standard deviation, the greater the volatility or risk.
Appreciation Appreciation is an increase in the value of an investment.
Asset An asset is anything with commercial or exchange value owned by a business, institution, or individual. Examples include cash, real estate, and other investments.
Asset Allocation Asset allocation is the process of distributing money across different asset classes with the intention of maximizing portfolio returns and minimizing risk. It does not guarantee a profit or ensure againt a loss.
Asset Class Asset class is a category of investments that have a similar behavior, risk and return potential. 
Asset-Backed Securities (ABS) Debt instruments where principal and interest payments are made to investors through revenue generated by an underlying pool of assets, such as credit card debt or automobile loans.
Average Annual Total Return Return on an investment over a specified period, including price appreciation (or depreciation) plus any reinvested income, expressed as an average annual compound rate of return. Average Annual Total Return is always hypothetical and should not be confused with actual year-by-year results. It smoothes out all of the variations in annual performance to tell you what constant year-by-year return would have produced the investment's actual cumulative return. This gives you an idea of an investment's annual contribution to your portfolio, provided you held it for the entire period.
Back-end Load A charge an investor pays when withdrawing money from an investment. It is designed to discourage withdrawals. Back-end loads typically decline each year a shareholder remains in a fund.
Back-Test Applying a set of rules or criteria retrospectively to historical data for research and analysis purposes.
Bank of America Merrill Lynch US 3-Month Treasury Bill Index Tracks the performance of U.S. dollar denominated U.S. Treasury Bills publicly issued in the U.S. domestic market maturing in less than three months.
Basis Point (bp) One basis point (bp) equals 1/100 of a percentage point (1 bp = 0.01%, 100 bps = 1%).
Batting Average Batting average is defined as the percentage of periods an investment has outperformed an index.
Bearish A market outlook or sentiment expecting declining prices or negative trends.
Benchmark (see Index) Benchmark refers to an unmanaged group of securities whose performance is used as a standard to measure investment performance.  You cannot invest directly in a benchmark.
Beta Beta measures the volatility of a security or portfolio relative to an index. A beta of less than one means lower volatility than the index; more than 1 means greater volatility.
Bid-to-Cover Ratio Bid-to-cover ratio is used to measure the demand for a particular security during offerings and auctions. A high ratio is an indication of strong demand and vice versa.
Black Swan A black swan event is a high-impact, uncommon occurrence that has a major impact. 
Bloomberg 1-3 Year U.S. Corporate Bond Index Measures the performance of the short term U.S. corporate bond market.
Bloomberg Global Aggregate ex USD Bond Index Tracks investment-grade government, corporate, agency, and mortgage-related bonds in markets outside the U.S.
Bloomberg Global Aggregate Index Is a measure of global investment grade debt from twenty-four local currency markets. This multi-currency benchmark includes treasury, government-related, corporate and securitized fixed-rate bonds from both developed and emerging markets issuers.
Bloomberg GNMA Index Tracks the performance of mortgage-backed pass-through securities of the Government National Mortgage Association (GNMA).
Bloomberg Muni Index The Bloomberg Municipal Bond Index is a broad-based benchmark that measures the investment grade, US dollar-denominated, fixed tax-exempt bond market. The index includes state and local general obligation, revenue, insured, and pre-refunded bonds.
Bloomberg Municipal 1-15 Year Blend (1-17) Bond Index Is a sub-index of the Bloomberg Municipal Bond Index. It is a rules-based market value-weighted index of bonds with maturities of one year to 16 years and 11 months engineered for the tax-exempt bond market.
Bloomberg Municipal Bond Index Is a broad-based benchmark that measures the investment grade, US dollar-denominated, fixed tax-exempt bond market. The index includes state and local general obligation, revenue, insured, and pre-refunded bonds.
Bloomberg U.S. 1-5 Year Treasury TIPS Measures the performance of inflation-protected public obligations of the U.S. Treasury that have a remaining maturity of less than five years.
Bloomberg U.S. Aggregate Bond Index Tracks intermediate-term domestic investment-grade bonds, including corporate, government, and mortgage-backed securities.
Bloomberg U.S. TIPS Index Consists of inflation-protected securities issued by the U.S. Treasury.
Bloomberg US 4-10 YR Treasury Index The Bloomberg US 4-10 YR Treasury Index consists of U.S. dollar-denominated, fixed rate nominal debt issued by the U.S. Treasury with maturities between four and ten years.
Bond A bond is an investment that pays a fixed rate of return through interest or dividend income. There are different types: corporate, Treasury, high-yield and municipal with varying durations and risk levels. 
Bond Rating A bond rating is an evalulation of creditworthiness for a fixed income investment. Higher-rated bonds are the most likely to fulfill obligations whereas lower-rated bonds are less likely.
Book Value Book value of a company is assets minus liabilities.
Book-to-Market Book-to-market is a financial ratio that compares book value to market value to evaluate a company stock.
Bullish Bullish is used when describing market sentiment; a bullish market is one where prices are generally expected to rise.
Call Options A contract giving the holder the right, but not the obligation, to buy an asset at a specified price within a set time period.
Capex Capex (capital expenditure) refers to a company’s spending in long-term assets such as property, technology, or equipment.
Capital Gain Capital gain refers to profits gained from the sale of a capital asset that has increased in value over the holding period. 
Capital Loss Capital loss occurs when an asset is sold for less than its purchase price. 
Capitalization (Cap) or Market Cap Capitalization refers to the total equity value of a company's publicly traded shares. 
Capture Ratio Capture ratio measures the performance an investment "captured" during periods when gains over an index are achieved (up capture) or declined (down capture). A capture ratio of 100% means investment performance went up or down exactly the same amount as the index.
Carry Carry is the excess income earned from holding a higher-yielding security relative to another.
CBOE Volatility Index (VIX) CBOE Volatility Index (VIX) is a calculation designed to produce a measure of constant, 30-day expected volatility of the U.S. stock market.
Collaterized Loan Obligations (CLOs) Collaterized loan obligations are securitized portfolios of bank loans structured into slices, or tranches, of varying credit risk.
Commercial Mortgage-Backed Security (CMBS) Investments backed by pools of commercial real estate mortgages, such as loans for hotels, shopping centers, office buildings, and apartment buildings.
Compound Interest Compound interest is calculated on the principal amount and the accumulated interest of previous periods, and thus can be regarded as “interest on interest.” In contrast, simple interest is a one-time calculation on the principal amount.
Continuing Care Retirement Communities Bonds (CCRC) Municipal bonds issued by local governments to finance construction of senior assisted living facilities.
Convexity A measure of the curvature in the relationship between bond prices and yields.  A bond with positive convexity means the price increase from falling yields is greater than a price decrease associated with rising yields of the same magnitude and negative convexity is when a bond’s price decrease from rising yields is greater than a price increase from falling yields of the same magnitude.
Correlation Correlation measures the degree to which two variables move in relation to each other. A value of 1.0 implies movement in parallel, -1.0 implies movement in opposite directions, and 0.0 implies no relationship.
CPI  CPI (Consumer Price Index) measures the monthly change in prices U.S. consumers will pay for a basket of goods and services.
Credit Default Swap A credit default swap involves regular payments from the buyer to the seller in exchange for repayment of principal value to the buyer if the issuer experiences a credit event such as default.
Credit Risk Credit risk is the that a bond issuer will default, meaning not repay principal or interest to the investor as promised. Credit risk is also known as “default risk.” 
Credit Risk Transfer (CRT) Securities Credit risk transfer (CRT) securities are a type of mortgage backed security issued by Fannie Mae or Freddie Mac but with the credit risk borne by private investors. CRTs can incur losses if enough homeowners in a pool of mortgages default on their loans.
Credit Selection Effect Measures how much of the portfolio's return relative to its benchmark is due to the manager's selection of debt securities based on an issuer's ability to meet its debt obligations and by predicting its future creditworthiness.
Credit Spread Credit spread is the difference in yield between securities with similar maturity but different credit quality. Widening spreads generally indicate deteriorating creditworthiness of corporate borrowers, and narrowing indicate improving.
Credit Suisse High Yield Index Tracks the performance of domestic noninvestment-grade corporate bonds.
Currency Hedging Using financial instruments to reduce or eliminate the risk of adverse currency movements affecting investments denominated in foreign currencies.
Current Yield Current yield represents the weighted average coupon on securities held in the portfolio as a percentage of the weighted average price.
CUSIP Number Identification number assigned to every stock, corporate bond, and municipal bond by the Committee on Uniform Securities Identifications Procedures (CUSIP), which is established by the American Bankers Association.
Deflation Deflation refers to the opposite of inflation-a general decline in the prices of goods and services. 
Depreciation Depreciation refers to a decrease in the value of an investment. 
Derivatives Overlay The use of derivative instruments layered on top of an existing portfolio to manage risk, adjust exposures, or enhance returns without altering the underlying assets.
Diversification Diversification is the practice of investing in multiple asset classes and securities with different risk characteristics in an effort to reduce the risk of owning any single investment. 
Dividend Dividends are portions of a company's profits that are returned to stockholders. 
Dividend Income The distribution of earnings to stockholders and shareholders. The per-share amount is decided by the board of directors. On individual stocks, dividends are usually paid quarterly. Mutual fund dividends are paid out of net income and may be distributed on a monthly, quarterly (March, June, September, and December) or annual basis.
Dividend Yield Dividend yield is the yield a company pays out to shareholders in the form of dividends. It is calculated by taking the amount of dividends paid per share over the course of a year and dividing by the stock's price.
Dow Jones Industrial Average Tracks the performance of stocks of 30 large U.S. companies.
Duration Duration is a measure of a bond or bond portfolio’s interest rate sensitivity. Short duration bonds are less sensitive than longer-duration bonds to changes in interest rates. 
Earnings Growth Rate Earnings growth rate refers to the annualized rate of growth of earnings for a stock or stocks in a portfolio over a given forward looking or trailing period.
Earnings per Share (EPS)  Earnings per share (EPS) is a profitability measure calculated by dividing earnings by outstanding shares.
Enhanced Beta or Smart Beta Enhanced beta or smart beta refers to a set of investment strategies that emphasize the use of alternative index construction rules to traditional market capitalization-based indices.
Equity Duration  Equity Duration is a measurement of an equity investment’s price sensitivity to changes in interest rates.
Equity Research Long/Short Relies on fundamental research to provide long and short exposure to global large-cap stocks. Long positions are established in companies the financial professional views as most attractive and short positions are established in companies viewed as least attractive.
Equity/Equities An equity is security or investment representing ownership in a corporation. It is different from a bond, which represents a loan to a borrower. The term is often used interchangeably with “stock.”
Excess Return Excess return indicates the extent to which an investment outperformed or underperformed an index.
Ex-Dividend/Reinvestment Date The date on which a stock's price drops by the amount of a previously announced dividend. It is the day after the "record date," defined later. Stocks trading "ex dividend" have an "x" next to their name.
Expense Ratio - Gross and Net The gross expense ratio reflects fund expenses as stated in the fee table of a fund's prospectus prior to the deduction of any waiver or reimbursement. The net expense ratio reflects fund expenses after the deduction of any waiver or reimbursement. 
Factor Investing or Factor Analysis Factors or factor analysis is an investment approach that involves targeting quantifiable firm characteristics or “factors” that can explain differences in stock returns. Over the last 50 years, academic research has identified hundreds of factors that impact stock returns.
Fed Funds Rate  The Fed funds rate is the interest rate banks charge each other for short-term loans; it is set by the Fed.
Fiscal Year Accounting period covering 12 consecutive months, 52 consecutive weeks, 13 consecutive four-week periods, or 365 consecutive days, at the end of which the books are closed and a profit or loss is determined.
Fixed Income Absolute Return Seeks consistent positive returns without constraints to particular benchmarks or fixed income asset classes.
Foreign Exchange (FX) The foreign exchange market is a global, decentralized marketplace for the trading of currencies. It determines the price for each currency and is typically used to settle cross-currency payments and hedge currency risk.
Forward Contract A customized agreement to buy or sell an asset at a specified price on a future date, settled at maturity.
Forward Rate The agreed-upon interest rate or price for a financial transaction that will occur at a future date.
Free Cash Flow Free cash flow is an accounting measurement of the cash that a company generates from its operations minus the capital expenditures required to maintain its business.
Front End Load Sales charge applied to an investment at the time of purchase. For example: An investor who purchases $10,000 of a fund with a 4% front end load will invest only $9,600 initially.
FTSE EPRA/NAREIT Dev Real Estate Index Net The FTSE EPRA/NAREIT Dev Real Estate Index Net tracks the performance of listed real estate companies and REITS worldwide.
FTSE™ developed ex North America Index Is a broadly diversified stock market index based on the investable market capitalization of more than 1,200 predominately larger companies. The index's major markets include the U.K., Japan, and developed countries in Europe and the Pacific Rim.
Futures Swap A type of derivative combining futures contracts with swap agreements to exchange cash flows or exposures.
GDP (Gross Domestic Product) The total value of finished goods and services produced in an economy.
General Obligation (GO) A type of municipal bond where the interest and principal payments are backed by a state or local government's ability to tax its residents, used to finance capital improvements.
Glide Path Glide path refers to a target date or age-based fund's asset allocation mix shifting from a focus on riskier securities to a focus on less risky securities. 
Global Financial Crisis (GFC)  The Global Financial Crisis (GFC) was a worldwide economic crisis of the financial markets and banking systems between mid-2007 and early 2009.
Government Related - Taxable Municipals Debt obligations that are issued by state and local governments for projects which do not meet the federal requirements for tax-exempt status.
Government Related Quasi-Sovereign Debt instruments that are issued by entities which are government-owned or backed, but are not the national government itself.
Government Securities Government securities are debt obligations issued by a government or its agencies.
Hyperinflation  Hyperinflation refers to extreme inflation as a result of rapid price increases over a defined period.
ICE BofA ML 3-Month US Treasury Bill Index Is comprised of a single issue purchased at the beginning of the month and held for a full month. The index is rebalanced monthly and the issue selected is the outstanding Treasury Bill that matures closest to, but not beyond 3 months from the rebalancing date.
ICE BofA US High Yield Constrained Index Contains all securities in The ICE BofA US High Yield Index but caps issuer exposure at 2%. The ICE BofA US High Yield Index tracks the performance of US dollar denominated below investment grade corporate debt publicly issued in the US domestic market.
ICE BofA US High Yield Constrained Index The ICE BofA US High Yield Constrained Index contains all securities in The ICE BofA US High Yield Index but caps issuer exposure at 2%. The ICE BofA US High Yield Index tracks the performance of US dollar denominated below investment grade corporate debt publicly issued in the US domestic market.
Idiosyncratic Risk or return characteristics specific to a single asset or company that are independent of broader market movements.
Inception Date The date on which the fund commenced operations.
Income Dividends For a mutual fund, a distribution of dividends and interest earned on the fund's underlying securities.
Index (see Benchmark) An index or benchmark refers to an unmanaged group of securities whose performance is used as a standard to measure investment performance.  You cannot invest directly in an index.
Index Fund An index fund is an investment fund that seeks to parallel the performance of a particular stock market or bond market index. Index funds are often referred to as passively managed investments. 
Industrial Development Revenue Bonds (IDR) Municipal debt securities, issued by a state or local government on behalf of a private company, used to build or acquire factories or other heavy equipment and tools.
Inflation Inflation refers to the overall general upward price movement of goods and services in an economy. Inflation is one of the major risks to investors over the long term because it erodes the purchasing power of savings.
Information Ratio Information ratio is a measurement of returns above a benchmark compared with the volatility of those returns. It is an indicator of portfolio management performance in excess of a given benchmark.
Institute of Supply Management (ISM)  Institute of Supply Management (ISM) Manufacturing Index is an economic indicator used to measure health of the manufacturing sector.
Interest Rate Management (IR Mgmt) The process of adjusting an investment portfolio to help minimize risk and capitalize on potential opportunities presented by fluctuating interest rates.
Interest/Interest Rate Interest represents the fee charged by a lender to a borrower, usually expressed as an annual percentage of the principal. For example, someone investing in bonds will receive interest payments from the bond’s issuer. 
Intraday Value, also called Intraday Indicative Value (IIV) or Indicative Optimized Portfolio Value (IOPV) Intraday value represents a real-time estimate of an exchange-traded fund's fair value, based on the most recent prices of its underlying securities.
Inverse (or Short) Exposure Inverse (or short) exposure means the performance of an investment will move in the opposite direction of the underlying index or asset.
Investment Objective An investor's financial goal, such as long-term capital growth or current income. Investors' objectives, combined with their risk profiles, help them narrow their search for investment vehicles appropriate for their particular needs.
Investment Strategy A plan to allocate assets among investments, including stocks, bonds, commodities, and real estate, to reach a financial goal. A strategy should be based on an investor's age, tolerance for risk, amount of capital available to invest, and future needs for capital.
Level Load A sales charge that does not change over time. Although a level load will typically be lower than a front-end or back-end load, investors end up paying a higher commission if they hold the fund for many years.
Lipper Averages Consist of all the mutual funds in a particular category as tracked by Lipper Inc.
Lipper Indices Consist of the largest mutual funds in a particular category as tracked by Lipper Inc. Categories are grouped by sector, industry, country and market capitalization.
Load Sales charge paid by an investor who buys shares in a load mutual fund or annuity.
Long Position Owning a security or buying derivatives, with the expectation that the security/underlying asset’s price will increase.
Longevity Risk The risk that an individual will outlive their financial resources due to longer-than-expected life expectancy.
Long-term Capital Gain The difference between the purchase price of a security and the price at which it was sold. For tax purposes, the profit or loss realized from the sale of securities or other capital assets held for more than 12 months. Quarterly distributions are paid at the end of each quarter (Mar, Jun, Sep, and Dec). Annual distributions are paid in December.
Macro and Absolute Return Seeks to leverage global research expertise to select investments that we believe represent the best investment ideas across all equity and fixed income asset classes.
Magnificent Seven The “Magnificent Seven” is Alphabet (Google), Amazon, Apple, Meta, Microsoft, NVIDIA, and Tesla. The specific securities identified and described are for informational purposes only and do not
represent recommendations.
Management Fee Management fees, whether paid as a fund expense ratio or a fee paid to an advisor, are charges levied for managing an investment.  The fee is intended to compensate the managers for their time and expertise selecting securities and managing the portfolio.
Maximum Drawdown The largest peak-to-trough decline in the value of an investment over a specified period.
Mean Reversion  Mean Reversion is a financial theory that suggests asset prices will eventually return to their long-term mean or average.
Median Market Capitalization The value of a corporation calculated by multiplying the number of outstanding shares by the current share price.
Momentum Signal A measure indicating the strength and speed of price trends, with the signal indicating whether a trend is strengthening or weakening.
Monte Carlo Simulation A statistical technique that uses random sampling and multiple iterations to provide a range of possible outcomes and probabilities associated with an uncertain event.
Morningstar Moderately Conservative Target Risk Index Family is designed to meet the needs of investors who would like to maintain a target level of equity exposure through a portfolio diversified across equities, bonds and inflation-hedged instruments. The Morningstar Moderately Conservative Target Risk Index seeks approximately 40% exposure to global equity markets.
Mortgage-Backed Securities (MBS) Investments backed by pools of home mortgages and other real estate debt purchased from the banks who issued them.
MSCI ACWI Ex-US Index  The MSCI ACWI Ex-US Index is an equity index that captures large and mid-cap representation across 22 of 23 developed market countries, excluding the U.S., and 24 emerging market countries, covering 85% of the global equity opportunity set outside of the U.S.
MSCI ACWI IMI Gold Net The MSCI ACWI IMI Gold Index captures large, mid and small cap representation across 23 Developed Markets and 24 Emerging Markets countries. All securities in the index are classified in the Gold sub-industry (within the Materials sector) according to the Global Industry Classification Standard (GICS®).
MSCI All Country Asia Ex Japan Index Tracks the stocks of developed and emerging countries in the Asia Pacific region, excluding Japan.
MSCI All Country World Index Tracks the equity market performance of small- to large cap stocks from global developed and emerging markets.
MSCI All Country World Index ex USA Tracks the equity market performance of small- to large cap stocks from global developed and emerging markets, excluding the USA.
MSCI All Country World Index-Information Technology Is an index that is designed to measure the performance of large and mid-cap technology securities across global developed and emerging markets. All securities in the index are classified in the Information Technology sector, per the Global Industry Classification Standard (GICS®).
MSCI Arabian Markets & Africa 10/40 IMI Index Captures large, mid and small cap representation across 23 countries in the MENA region. The MSCI 10/40 equity indexes are designed and maintained on a daily basis to take into consideration the 10% and 40% concentration constraints on funds subject to the UCITS III Directive.
MSCI China All Shares Index Captures large and mid-cap representation across China A‐shares, B‐shares, H‐shares, Red‐chips, P-chips and foreign listings (e.g. ADRs). The index aims to reflect the opportunity set of China share classes listed in Hong Kong, Shanghai, Shenzhen and outside of China. It is based on the concept of the integrated MSCI China equity universe with China A-shares included.
MSCI EAFE Index  Tracks the performance of stocks of about 1,000 large and mid-cap companies in Europe, Australasia, and the Far East (EAFE).
MSCI EAFE Index Net  Is an equity index which captures large and mid-cap representation across 21 Developed Markets countries around the world, excluding the US and Canada. Developed Markets countries in the MSCI EAFE Index include: Australia, Austria, Belgium, Denmark, Finland, France, Germany, Hong Kong, Ireland, Israel, Italy, Japan, the Netherlands, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland and the UK.
MSCI Emerging Markets Europe Index Captures large and mid-cap representation across 6 Emerging Markets countries in Europe.
MSCI Emerging Markets Index Captures large and mid-cap representation across 26 Emerging Markets countries.
MSCI Emerging Markets Latin America Index Captures large and mid-cap representation across 6 Emerging Markets countries in Latin America.
MSCI Europe Index Captures large and mid-cap representation across 15 Developed Markets countries in Europe. 
MSCI Japan Index Measures the performance of the large and mid-cap segments of the Japanese market.
MSCI U.S. Small Cap Growth Index Tracks the performance of domestic small-cap growth stocks as defined by MSCI.
MSCI World Investable Market Index (IMI) Captures large, mid and small cap representation across 23 Developed Markets countries.
MSCI World Select Natural Resources Index Is based on its parent index, the MSCI World IMI Index which captures large, mid and small cap securities across 23 Developed Market countries. The Index is designed to represent the performance of listed companies within the developed markets that own, process or develop natural resources.
Nasdaq Composite The Nasdaq Composite is an unmanaged index representing the companies traded on the Nasdaq stock exchange and the National Market System and is heavily weighted toward technology stocks.
Net Asset Value (NAV) Net asset value represents the value of a fund's assets after deducting its liabilities from its assets on a per-share basis.
Net Assets ($M) Differences between a company's total assets and liabilities.
Net Equity Exposure The difference between a portfolio’s long equity positions and short equity positions.
Net Zero Net zero refers to greenhouse gas production being balanced by removal from the atmosphere.
No-Load Mutual fund offered by an open-end investment company that imposes no sales charge (load) to purchase shares. Investors can buy shares directly from the fund company, rather than through a broker.
Omega Ratio Omega ratio measures the change in an option's value with respect to the percentage change in the underlying price. It gives option investors an idea of how the option price and the stock price that underlies it move together.
Operating Expenses Operating expenses are asset-based expenses paid out of a fund's or portfolio's assets as a percentage of the value, and can include the investment advisory fee; marketing and distribution expenses; and custodial, transfer agency, legal and accounting fees. 
Option-Adjusted Spread Option-adjusted spread measures the spread between a fixed income security rate and the risk-free rate of return, which is adjusted to take into account an embedded option.
Passive Management Passive investments seek to match the performance of their benchmark; therefore, holdings generally are not selected or reallocated based on changes in market conditions. As a result, the investment’s performance will typically differ from the performance of actively managed investments.
Pay Date Date on which a declared dividend is scheduled to be paid.
Pollution Control Revenue (PCR) Municipal debt securities, issued by a state or local government on behalf of a private company, used to finance environmental projects for private corporations.
Premium/Discount Premium/discount indicates whether a security is currently trading above (at a premium to) or below (at a discount to) its net asset value.
Pre-Refunded (PRE) A debt instrument where the issuer has redeemed from the bondholder before the set maturity date.
Price-to-Book (P/B) Ratio Relationship between the market price of a stock and company's book value per share. Book value refers to the value at which an asset is carried on the balance sheet. Price-to-book can be used as a guide to determine whether a stock is currently overpriced or underpriced.
Price-to-Cash Flow (P/CF) Ratio Price-to-cash flow ratio measures the current price of a company's stock relative to the amount of cash generated by the company.
Price-to-Earnings (P/E) Ratio Price-to-earnings ratio measures share price compared to earnings per share for a stock or stocks in a portfolio.
Price-to-Earnings (P/E) Ratio - Current Fiscal Year P/E is a valuation measure calculated by dividing the price of a stock by its reported earnings per share from the latest fiscal year. The ratio is a measure of how much investors are willing to pay for the company's earnings. The higher the P/E, the more investors are paying for a company's current earnings.
Price-to-Earnings (P/E) Ratio - Next Fiscal Year P/E is a valuation measure calculated by dividing the price of a stock by its estimated earnings for the next fiscal year. The ratio is a measure of how much investors are willing to pay for the company's future earnings. The higher the P/E, the more investors are paying for the company's expected earnings growth in the next fiscal year.
Price-to-Earnings Ratio (P/E) - 12 Months Forward P/E is a valuation measure calculated by dividing the price of a stock by the analysts' forecast of the next 12 months expected earnings. The ratio is a measure of how much investors are willing to pay for the company's future earnings. The higher the P/E, the more investors are paying for a company's earnings growth in the next 12 months.
Projected Earnings Growth Rate Projected earnings growth rate (IBES) is a company's expected earnings per share growth rate for a given period based on the forecast from the Institutional Broker's Estimate System, which is commonly referred to as IBES.
Prospectus A fund prospectus details the investment objectives and strategies of a particular fund or group of funds, as well as the fund's past performance, managers and financial information. 
Purchasing Manager’s Index (PMI)  Purchasing Manager’s Index (PMI) is an economic indicator used to measure the direction of economic trends in manufacturing and services sectors.
Put Option A derivative contract giving the holder the right, but not the obligation, to sell an asset at a specified price within a set time-period.
Quantitative Equity Long/Short Relies on quantitative research capabilities to provide long and short exposure to small- and mid-cap U.S. stocks.
R & D (Research and Development) R&D refers to research and development projects.
Rare Earths  Rare earths are certain chemical elements found in the Earth’s crust, typically not found in a concentrated form. They are used in high-tech applications.
Real Rates Real rates are equal to the difference between the 10-year nominal U.S. Treasury yield and expected inflation.
Record Date The date on which stock shareholder eligibility is identified for the purposes of dividend payout.
Redemption Fee Fee charged to shareholders by a mutual fund when they sell shares within a specified period. The time limit and size of fee vary among funds. The fee is usually paid to the fund, not the fund's investment professional. Its purpose is to protect long-term investors from short-term traders.
Region Allocation Effect Measures how much of the portfolio's return relative to its benchmark is due to the manager's decisions to over- and under-weight specific regions.
Reinvestment Price The price per share at which a mutual fund's dividends and/or capital gains are invested. This reduced price reflects the distribution of dividends and/or capital gains and is commonly referred to as the "ex-dividend" price.
Relative Valuation (aka Value Factor) A method of assessing an asset’s worth by comparing its valuation metrics (like price-to-earnings ratio) relative to peers or historical averages to identify undervalued or overvalued securities.
Repurchase Agreements Repurchase (repo) agreements are short-term loans collateralized by U.S. government securities.
Residential Mortgage-Backed Securities (RMBS) Investments backed by pools of residential loans, such as mortgages and home equity loans.
Return on Equity (ROE) Return on Equity (ROE) is a financial measurement that divides net income by shareholder equity.
Return on Invested Capital Return on invested capital is a measure of how effectively a company used the money invested in its operations.
Revenue Bonds (REV) A type of municipal bond used to finance specific projects that can generate their own income, such as airports, tolls, stadiums, etc. It is not backed by the government, but by the revenue(s) of the project itself.
Risk Budget The allocation of total portfolio risk across different asset classes, strategies, or positions to manage overall risk exposure.
Risk/Reward The relationship between the degree of risk associated with an investment and its return potential. Typically, the higher the potential return of an investment, the greater the risk.
Risk-Free Rate Risk-free rate of return is a theoretical return of an investment with zero risk and the measure is used as a rate against which other returns are measured.
Roll down Roll down is the tendency of a fixed income security’s market price to approach its par value as it nears maturity.
R-squared (R2) R-squared measures the relationship between portfolio and index performance on a scale of 0.00 (0%) to 1.00 (100%). A higher R2 indicates more of the portfolio's performance is explained by market movements and vice versa.
Russell 1000 Growth Index Measures the performance of the large-cap growth segment of the US equity universe. It includes those Russell 1000® companies with higher price-to-book ratios and higher forecasted growth values.
Russell 1000 Value Index Measures the performance of the 1,000 largest companies in the Russell 3000 Index with lower price-to-book ratios and lower forecasted growth values.
Russell 2000 Growth Index Is a market-weighted total return index that measures the performance of companies within the Russell 2000 Index having higher price/book value ratios and higher forecasted growth rates.
Russell 2000 Index Tracks the performance of the stocks of the 2,000 smallest companies in the Russell 3000 Index. 
Russell 2000 Value Index  Is a market-weighted total return index that measures the performance of companies within the Russell 2000 Index having lower price/book value ratios and lower forecasted growth rates.
Russell 2500 Index Is a market-cap-weighted index that includes the smallest 2,500 companies covered in the broad-based Russell 3000 sphere of United States-based listed equities. All 2,500 of the companies included in the Index cover the small- and mid-cap market capitalizations.
Russell 3000 Index Is a market-weighted equity index that tracks the performance of the 3,000 largest U.S.-traded stocks which represent about 98% of all U.S. incorporated equity securities.
Russell Midcap Growth Index Measures the performance of those Russell Midcap companies with higher price-to-book ratios and higher forecasted growth values.
Russell Midcap Index Measures the performance of the 800 smallest companies in the Russell 1000 Index.
Russell Midcap Value Index Measures the performance of those Russell Midcap companies with lower price-to-book ratios and lower forecasted growth values. 
S&P 400 MidCap Index Tracks the stocks of 400 U.S. mid-cap companies.
S&P 500 Index  Measures the performance of the large-cap segment of the market. It is a market cap-weighted index of 500 stocks representing major industries. 
S&P Completion Index Tracks the performance of the U.S. stocks not included in the S&P 500, which are primarily small- and mid-capitalization stocks. The index includes approximately 4,000 stocks.
S&P Global ex-U.S. Small Cap Index Tracks the performance of smaller companies in developed markets outside the U.S.
S&P Target Date 2010 Index Are a series of multi-asset class indexes corresponding to a particular target retirement date. Each index is composed of different allocations to stocks, bonds, and short-term investments that reflect reductions in potential risk over time.
S&P Target Date 2015 Index Are a series of multi-asset class indexes corresponding to a particular target retirement date. Each index is composed of different allocations to stocks, bonds, and short-term investments that reflect reductions in potential risk over time.
S&P Target Date 2020 Index Are a series of multi-asset class indexes corresponding to a particular target retirement date. Each index is composed of different allocations to stocks, bonds, and short-term investments that reflect reductions in potential risk over time.
S&P Target Date 2025 Index Are a series of multi-asset class indexes corresponding to a particular target retirement date. Each index is composed of different allocations to stocks, bonds, and short-term investments that reflect reductions in potential risk over time.
S&P Target Date 2030 Index Are a series of multi-asset class indexes corresponding to a particular target retirement date. Each index is composed of different allocations to stocks, bonds, and short-term investments that reflect reductions in potential risk over time.
S&P Target Date 2035 Index Are a series of multi-asset class indexes corresponding to a particular target retirement date. Each index is composed of different allocations to stocks, bonds, and short-term investments that reflect reductions in potential risk over time.
S&P Target Date 2040 Index Are a series of multi-asset class indexes corresponding to a particular target retirement date. Each index is composed of different allocations to stocks, bonds, and short-term investments that reflect reductions in potential risk over time.
S&P Target Date 2045 Index Are a series of multi-asset class indexes corresponding to a particular target retirement date. Each index is composed of different allocations to stocks, bonds, and short-term investments that reflect reductions in potential risk over time.
S&P Target Date 2050 Index Are a series of multi-asset class indexes corresponding to a particular target retirement date. Each index is composed of different allocations to stocks, bonds, and short-term investments that reflect reductions in potential risk over time.
S&P Target Date 2055 Index Are a series of multi-asset class indexes corresponding to a particular target retirement date. Each index is composed of different allocations to stocks, bonds, and short-term investments that reflect reductions in potential risk over time.
S&P Target Date 2060 Index  Represents a broadly derived consensus of asset class exposure and glide path for target date year 2060 or later. The index allocates to equities and fixed income at varying levels, according to a pre-determined schedule related to the respective target date.
S&P Target Date Indexes Are a series of multi-asset class indexes corresponding to a particular target retirement date. Each index is composed of different allocations to stocks, bonds, and short-term investments that reflect reductions in potential risk over time.
S&P Target Date Retirement Income Index Is designed to serve as the ultimate endpoint for all assets tracking other indices in the S&P Target Date Index Series. When an index in the S&P Target Date Index Series is retired, any funds tracking that index will have the assets rolled into a fund that tracks the S&P Target Date Retirement Income Index.
S&P Target Date Retirement Income Index  Is designed to serve as the ultimate endpoint for all assets tracking other indices in the S&P Target Date Index Series. When an index in the S&P Target Date Index Series is retired, any funds tracking that index will have the assets rolled into a fund that tracks the S&P Target Date Retirement Income Index.
S&P Total Market Index Tracks the performance of a broad spectrum of small-, mid-, and large-capitalization U.S. stocks. Because the largest stocks in the index carry the most weight, large-capitalization stocks make up a substantial majority of the S&P Total Market's value.  The index includes approximately 4,500 stocks.
S&P/LSTA Performing Loan Index Is a market-value weighted index designed to measure the performance of the US leveraged loan market for loans which are not in default and are continuing to make interest and principal payments.
Sahm Rule The Sahm rule is a potential recession signal identified by economist Claudia Sahm in which the unemployment rate’s three-month moving average rises at least 0.5% above its low in the previous 12 months.
Sales Charge Sales charge is the amount that investors pay when they buy (front-end load) or redeem (back-end load) shares in a mutual fund, similar to a commission.
Sector Value added from sector weighting versus the benchmark.
Sector Allocation Effect Measures how much of the portfolio's return relative to its benchmark is due to the manager's decisions to over- and under-weight specific sectors.
Sector Weightings Calculations for equity funds, based on the securities in the fund's portfolio on a certain date. For domestic equity funds, sector weightings show the percentage of the fund's net assets invested in each of the 10 major industry classifications. Morningstar uses the following sectors: utilities, energy, financials, industrial cyclicals, consumer durables, consumer staples, services, retail, health, and technology.
Security A security is an instrument of investment such as a stock, bond or fund.
Selection Value added from security selection within the sector or indicated.
Sentiment Sentiment refers to the overall mood or attitude of investors regarding financial markets.
Sharpe Ratio Sharpe ratio measures risk-adjusted performance using excess returns versus the "risk-free" rate and the volatility of those returns. A higher ratio means better return per unit of risk.
Short Position Borrowing and selling a security that the investor does not own or taking the selling a derivative, with expectations that the security/underlying asset’s price will fall. 
Short-term Capital Gain The difference between the purchase price of a security and the price at which it was sold, assuming the difference is positive and the investment gained in value. For tax purposes, the profit realized from the sale of securities or other capital assets held 12 months or less. Quarterly distributions are paid at the end of each quarter (March, June, September, and December). Annual distributions are paid in December.
Sortino Ratio Sortino ratio measures risk-adjusted performance using excess returns versus the "risk-free" rate and the volatility of negative returns ("bad" volatility). A higher ratio means better return per unit of "bad" risk.
Spot Rate The current interest rate or price for immediate settlement of a financial instrument or currency.
Stagflation  Stagflation is an economic cycle of slow growth, high unemployment, and rising prices.
Standard Deviation Standard deviation measures historical volatility. Higher standard deviation implies greater volatility.
Stock Selection Effect Measures how much of the portfolio's return relative to its benchmark is due to the manager's selection of specific securities.
Strategic Asset Allocation A long-term investment approach that sets target allocations for asset classes based on risk tolerance and investment objectives.
Style Premia Selects the various instruments across asset classes that include currencies, equity index, futures, and bond or interest rate futures based on whether the instruments exhibit positive characteristics or factors.
Systematic Risk Systematic risk is the risk inherent to the entire market or entire market segment.
Tactical Asset Allocation An active investment approach that adjusts portfolio weights in seeking to exploit short-term market opportunities or trends.
Tail Risk Tail risk refers to the potential for an extreme and unexpected event that would have a significant impact on performance.
Term Premia Term premia refers to the risk premia that investors require to hold a long-term bond to maturity.
The Fed  The Fed (the Federal Reserve) is the central bank of the United States.
Ticker Symbol Letters that identify a security for trading purposes on the consolidated tape.
Total Return Return on an investment over a specified period, including price appreciation (or depreciation) plus any reinvested income.
Total Return Swaps A total return swap involves paying a floating interest rate in exchange for payments based on the return of a reference asset, such as a corporate bond.
Tracking Error Tracking error is the divergence between the price behavior of an investment and an index.
Treasury Inflation-Protected Securities (TIPS)  Treasury Inflation-Protected Securities (TIPS) are a type of treasury security where the principal value is indexed to inflation.
Turnover Turnover is a measure of portfolio trading activity. Higher turnover may indicate higher transaction costs and vice versa.
Turnover Rate A percentage of holdings a fund buys and sells during a year.
Volatility Volatility measures risk using the dispersion of returns for a given investment.
Volatility Relative Value Primarily uses equity index call and put options to take advantage of the relative attractiveness of the volatility premium.
Weighted Average Takes into consideration the amount held of each security in relation to the total amount.
Weighted Average Life The dollar-weighted average maturity of a portfolio's securities without taking into account interest rate reset dates for certain adjustable-rate securities. It is a measure that reflects how a fund may react in periods when credit spreads are widening or liquidity conditions are tightening. In general, the longer the fund's average life, the greater its exposure to interest rate fluctuations. Money funds must maintain a weighted average life of less than 120 days.
Weighted Average Maturity The weighted average maturity is a measure of a fund's interest rate sensitivity. In general, the longer the average maturity, the greater the fund's sensitivity to interest rate changes. The weighted average maturity may take into account the interest rate readjustment dates for certain securities. Money funds must maintain a weighted average maturity of less than 60 days.
Wilshire RESI The Wilshire RESI is an index that measures the performance of publicly-traded real estate securities.
Yield Curve Inversion A yield curve inversion is when short-term interest rates exceed longer-term rates and is often a harbinger of recession.
Yield to Maturity Yield to maturity is the total return anticipated on a bond held to maturity assuming all the securities are held to maturity.
Yield to worst (YTW) Yield to worst is a measure of the lowest possible yield on a bond whose contract includes provisions that would allow the issuer to redeem the securities before they mature.