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Mortgage Backed Security |
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A pass-through security that
aggregates a pool of mortgage-backed debt obligations.
Mortgage-backed securities’ principal amounts
are usually government guaranteed. Homeowners’
principal and interest payments pass from the originating
bank through a government agency or investment bank,
to investors, net of a loan servicing fee payable
to the originator. |
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Multi-Manager Product |
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An investment pool that allocates
assets to a number of managers with different investment
styles. This methodology facilitates a high degree
of diversification and accordingly the potential
for a greater spread of risk. Hedge funds often
have this structure. Smaller investors are able
to enjoy access to a greater variety of managers
that would normally be prohibited by minimum investment
requirements for each manager. Funds of funds are
a classic multi-manager product. |
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Municipal Bond (USA) |
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A debt security issued by a state,
municipality, or county, in order to finance its capital
expenditures. Municipal bonds are exempt from federal
taxes and from most state and local taxes, especially
if you live in the state the bond is issued. Such expenditures
might include the construction of highways, bridges, or
schools. "Munis" are bought for their favourable
tax implications, and are popular with people in high
income tax brackets. |
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Mutual Fund |
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A security that gives small investors
access to a well diversified portfolio of equities, bonds,
and other securities. Each shareholder participates in
the gain or loss of the fund. Shares are issued and can
be
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redeemed as needed. The fund's
net asset value (NAV) is determined each day. Each mutual
fund portfolio is invested to match the objective stated
in the prospectus. Some examples of mutual funds are
UK Unit Trusts, Open-ended Investment Companies (OEICs),
EU registered UCITS, Luxembourg based SICAVs. |
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