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Core and Satellite
Core and satellite investing is a portfolio construction strategy that involves building a passive core portfolio of lower-cost, index-based securities. The manager then utilizes more aggressive or active strategies that are intended to add alpha or enhance overall portfolio performance. -
Corporate Bond
A debt security issued by a corporation and sold to investors. The backing for the bond is usually the payment ability of the company, which is typically money to be earned from future operations. In some cases, the company’s physical assets may be used as collateral for bonds. Corporate bonds are considered higher risk than government bonds. As a result, interest rates are almost always higher, even for top-flight... -
CPA
A designation given by the American Institute of Certified Public Accountants to those who pass an exam and meet work experience requirements. For the most part, the accounting industry is self-regulated. The CPA is a designation meant to help ensure that professional standards for the industry are enforced. Other countries have certifications equivalent to the CPA. For example, in Canada, accountants similar to the CPA are called Chartered Accountants... -
Creation Unit
A set of shares or securities that makes up one unit of a fund held by the trust that underlies an exchange-traded fund (ETF). One creation unit is the denomination of underlying assets that can be redeemed for a certain number of ETF shares. Creation units can vary in size; with most containing between 25,000 and 600,000 ETF shares each. The use of creation units in the construction of... -
Credit Risk
The risk of loss of principal or loss of a financial reward stemming from a borrower’s failure to repay a loan or otherwise meet a contractual obligation. Credit risk arises whenever a borrower is expecting to use future cash flows to pay a current debt. Investors are compensated for assuming credit risk by way of interest payments from the borrower or issuer of a debt obligation. Credit risk is... -
Cryptocurrency
A type of digital or virtual money that exists solely in electronic form. Encryption techniques are used to regulate the generation of units of currency and verify the transfer of funds, operating independently of a central bank, which makes it nearly impossible to counterfeit or double-spend. Many cryptocurrencies are decentralized networks based on blockchain technology—a distributed ledger enforced by a disparate network of computers. A defining feature of cryptocurrencies... -
Cryptocurrency ETF
A cryptocurrency ETF works, in theory, like any other ETF. While most ETFs track an index or a basket of assets, a cryptocurrency ETF would track one or more digital tokens. Like other ETFs, digital token ETFs would trade like common stocks on an exchange, and they would be subject to changes in price throughout the day as investors buy and sell. In order for a cryptocurrency ETF to... -
CUSIP (Committee on Uniform Security Identification Procedures)
CUSIP (Committee on Uniform Security Identification Procedures) is a 9-character alphanumeric code which identifies a North American financial security for the purposes of facilitating clearing and settlement of trades. (Source: Wikipedia) -
Custodian
A custodian is a financial institution that holds customers’ securities for safekeeping in order to minimize the risk of their theft or loss. A custodian holds securities and other assets in electronic or physical form. Since they are responsible for the safety of assets and securities that may be worth hundreds of millions or even billions of dollars, custodians generally tend to be large and reputable firms. Registered Investment...
