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1-9, A-Z Full Glossary List

401(k) Plans

401(k) Plans are retirement plans to which employees can make contributions from his or her paycheck before taxes are taken out. The contributions go into a 401(k) account, with the employee often choosing the investments based on options provided under the plan. There are four different types of 401(k) plans: traditional 401(k), safe harbor 401(k), SIMPLE 401(k), and automatic enrollment 401(k). (Source: US Department of Labor)

A-Shares

China A-shares are the stock shares of mainland China-based companies that trade on the two Chinese stock exchanges, the Shanghai Stock Exchange (SSE) and the Shenzhen Stock Exchange (SZSE). Historically, the shares were only available for purchase by mainland citizens due to China’s restrictions on foreign investment. However, since 2003, select foreign institutions have been able to purchase these shares through the Qualified Foreign Institutional Investor (QFII) system. Established in 2002, the QFII program...

Accredited Wealth Management: Advisor (AWMA®)

Individuals who hold the AWMA® designation have completed a course of study encompassing wealth strategies, equity-based compensation plans, tax reduction alternatives, and asset protection alternatives. Additionally, individuals must pass an end-of-course examination that tests their ability to synthesize complex concepts and apply theoretical concepts to real-life situations. All designees have agreed to adhere to Standards of Professional Conduct and are subject to a disciplinary process. Designees renew their designation every two-years by...

Active

Active investing (or Active Management) is an investment strategy involving ongoing buying and selling actions by the fund manager or investor seeking to outperform a benchmark index. Active investors purchase investments and continuously monitor their activity in order to exploit profitable conditions. Active investing is highly involved. Unlike passive investors, who invest in a stock when they believe in its potential for long-term appreciation, active investors will typically look...

After Tax Return

The return from an investment after all income taxes have been accounted for and deducted. The SEC has adopted a number of rule and form amendments requiring mutual funds to disclose standardized after-tax returns. The amendments require a mutual fund to disclose standardized after-tax returns for 1-, 5-, and 10-year periods in the risk/return summary of the prospectus. (source ETFGuide).

Alpha

Alpha is an analyst’s estimate of its potential price increase based on the rate at which the company’s earnings are growing and other aspects of the company’s current performance. For example, if a stock has an alpha of 1.15, that means the analyst expects a 15% price increase in a year when stock prices in general are flatOne investment strategy is to look for stocks whose alphas are high,...

Alta Trust

AltaTrust is an innovative financial services firm that acts as trustee for collective investment funds that feature unique money managers. Alta Trust works with retirement plan professionals to provide cutting-edge retirement plan products to stay ahead of a challenging global economy. (Source: 401khelpcenter.com)

Alternative Investment

An investment that is not one of the three traditional asset types (stocks, bonds and cash). Most alternative investment assets are held by institutional investors or accredited, high-net-worth individuals because of their complex nature, limited regulations and relative lack of liquidity. Alternative investments include hedge funds, managed futures, real estate, commodities and derivatives contracts. Many alternative investments also have high minimum investments and fee structures compared to mutual funds...

American Depository Receipt (ADR)

Receipt for the shares of a foreign based company held in the vault of a U.S. bank. Shareholders of ADRs are entitled to receive all dividends and capital gains. Individuals that want to own a foreign company without buying it on an overseas market can purchase an ADR listed on U.S. exchanges. (Source: ETFGuide)