Index
absolute return, 2nd
absolute risk
account aggregation
active funds, 2nd, 3rd, 4th, 5th, 6th
choosing
due diligence process (6P)
fees
Fundamental Law of Active Management
management, 2nd
active investors
Adaptive Market Hypothesis (AMH)
age of retirement, 2nd, 3rd
aggregate bond funds
alpha, 2nd, 3rd
alternative betas
alternative investments (AI), 2nd
AMC (Annual Management Charge), 2nd
AMH (Adaptive Market Hypothesis)
anchoring
animal spirits
annuities, 2nd, 3rd, 4th
advantages and disadvantages of
deferred
enhanced
and high-yield investments
index-linked payments
inheritance rules
and lifecycle investing
low-risk outcome
variable
Arbitrage Pricing Theory (APT)
arbitrage
asset allocation, 2nd, 3rd, 4th
models
portfolio rebalancing
see also SAA (Strategic Asset Allocation); TAA (Tactical Asset Allocation)
asset classes
alpha, 2nd 3rd
alternative, 2nd
beta, 2nd, 3rd, 4th
smart beta
choosing investments
historic performance
real and nominal assets
risk factors, 2nd
sources of returns
traditional, 2nd
ways of investing in
backfill bias
Bank of England (BOE)
base rate, 2nd, 3rd, 4th, 5th, 6th
interest rates
banks, 2nd, 3rd
behavioural finance
cognitive biases
herding and myopic thinking
know yourself
mental accounting
prospect theory
benchmarks in portfolio management
beta returns, 2nd, 3rd, 4th
smart beta
beta risk metric
Big Mac Index
black swans
Blind Person’s Allowance
bonds, 2nd
and active management
asset allocation, 2nd, 3rd, 4th, 5th
asset classification, 2nd, 3rd
alpha returns
blended portfolios
corporate bonds, 2nd, 3rd
cost of default
currency management
emerging markets, 2nd, 3rd
expected return on
high yield
inflation-linked
and infrastructure investing
investment bonds
and lifecycle investing
and monetary policy
over-the counter (OTC) trading
risk measures, 2nd, 3rd
yield curves, 2nd, 3rd
yield to maturity (YTM), 2nd, 3rd, 4th
see also gilts; government bonds (govies)
buy-to-let, 2nd, 3rd, 4th
costs
down payments
finding a property
hedging liabilities
holding companies
letting
mortgages, 2nd, 3rd, 4th
rental yield
selling
taxes, 2nd
CAPE (cyclically adjusted price-to-earnings) ratio, 2nd
Capital Asset Pricing Model (CAPM)
Capital Gains Tax (CGT), 2nd, 3rd
allowable losses
Annual Exempt Amount
buy-to-let properties, 2nd, 3rd
chargeable assets/gain
exemptions
capital market assumptions see CMAs (capital market assumptions)
capital preservation, 2nd, 3rd, 4th
CAPM (Capital Asset Pricing Model)
career average
cash assets, 2nd, 3rd, 4th
allocations, 2nd, 3rd, 4th, 5th
expected return on
historic performance
liquidity constraints, 2nd
cash flow management
cash ISAs, 2nd, 3rd, 4th
CEFs (closed-end funds)
Child Trust Funds
children
and inheritance tax
Junior ISAs, 2nd, 3rd
pensions for
CIRP (Covered Interest Rate Parity)
CISs (collective investment schemes), 2nd
CMAs (capital market assumptions)
and asset allocations, 2nd, 3rd
calculating portfolio volatility
data
expected correlation
expected returns
expected risk
and valuation
cognitive biases
commodities, 2nd, 3rd, 4th, 5th
equity commodities
gold/copper ratio
hard and soft
indices
super cycles
compound return
confirmatory bias
conservative assets
conservative capital preservation
contrarian investing
corporate bonds, 2nd, 3rd
counterparty risk, 2nd
couples, 2nd
Covered Interest Rate Parity (CIRP)
CRE (commercial real estate)
credit ratings
and corporate bonds
credit loss rates
credit risk
premium, 2nd
credit scores
crowded trades
currency management
currency risk
DB (defined benefit) pensions, 2nd, 3rd, 4th
final salary pensions, 2nd, 3rd
liabilities and risks, 2nd
DC (defined contribution) pensions, 2nd
Additional Voluntary Contributions (AVCs)
asset classes
boosting
consolidating
how much to save
money purchase annual allowance
taking lump sums from
death in service benefits
death-dependent annuity
default investment strategies, 2nd
deferred annuities
derivatives, 2nd, 3rd, 4th, 5th
DGFs (Diversified Growth Funds), 2nd, 3rd
dilution levy
direct property
discount mortgages
discount rates
discounted cash flow (DCF) model
diversification, 2nd, 3rd, 4th
blended portfolios
local versus global
and Modern Portfolio Theory (MPT)
multi-asset investing
three buckets approach to, 2nd
Diversified Growth Funds (DGFs), 2nd, 3rd
dividend discount model (DDM)
dividend tax
dollar-cost averaging
double-dip recession
downside risk, 2nd, 3rd
dynamic SAA, 2nd, 3rd, 4th, 5th, 6th
economic cycle
depressions
growth/expansion, 2nd
the investment clock
output gap
recession, 2nd, 3rd, 4th
recovery, 2nd
slowdown, 2nd
and TAA, 2nd
efficient frontier
Efficient Market Hypothesis (EMH)
emerging market debt (EMD), 2nd, 3rd, 4th, 5th, 6th, 7th
emerging market equities (EME), 2nd, 3rd, 4th, 5th, 6th, 7th
emerging markets, 2nd, 3rd
endowment effect
Enterprise Investment Scheme (EIS)
Environmental, Social and Governance (ESG)
equities, 2nd, 3rd
asset allocation, 2nd, 3rd, 4th, 5th
asset classification, 2nd, 3rd, 4th
alpha
risk premiums
and bonds
capital market assumptions, 2nd, 3rd
currency management
dividend tax
dividend yield, 2nd, 3rd, 4th
earnings growth
and the economic cycle, 2nd
EME, 2nd, 3rd, 4th, 5th, 6th, 7th
equilibrium
global, 2nd, 3rd, 4th, 5th
and inflation
Initial Public Offering (IPO)
investment principles
liquidity constraints
price and value
private equity, 2nd, 3rd
re-pricing, 2nd
returns, 2nd
and time horizons
transaction costs
UK, 2nd, 3rd
historic performance, 2nd
portfolio diversification, 2nd
volatility of
equity commodities
equity release
equity risk premium (ERP), 2nd, 3rd, 4th
estate planning, 2nd
ETFs (exchange traded funds)
European debt crisis
Eurozone, 2nd
exchange rates
expected liquidity needs
factor investing
factor-based investment cycles
fair-weather investing
Fama-French three-factor model
fat tails, 2nd
fee budget
financial advisers, 2nd
Financial Conduct Authority (FCA), 2nd
financial crisis (2008), 2nd, 3rd, 4th
Financial Services Compensation Scheme (FSCS)
fiscal policy
fixed income investments see bonds
fixed income risks
fixed-rate mortgages, 2nd
Flexible-Access Drawdown (FAD)
flight to quality, 2nd
FoFs (fund of funds)
frontier markets
FTSE 100 Index, 2nd, 3rd
expected returns
historic performance
market leadership
return objectives, 2nd, 3rd
alpha, 2nd
beta
trackers, 2nd
FTSE REIT indices
fund managers
active management, 2nd
authorised funds
cognitive biases
freeing, 2nd
hedge funds
and investment strategy
manager risk
performance fees
philosophy, 2nd
funds
active versus passive, 2nd
de-selection
investment vehicles
fees and costs
multi-asset, 2nd
platforms
process
selection based on past performance
versus individual securities
futures, 2nd
FWI (Fundamentally Weighted Index)
gilts, 2nd, 3rd, 4th, 5th, 6th
asset allocation
in blended portfolios
capital market assumptions, 2nd, 3rd
historic performance, 2nd
glide paths, 2nd, 3rd, 4th, 5th
global diversification
global equities, 2nd, 3rd, 4th, 5th
governance budget
government bonds (govies), 2nd, 3rd
and the economic cycle, 2nd
emerging markets, 2nd, 3rd
see also bonds; gilts
group personal pensions (GPPs)
hedge funds, 2nd, 3rd
benchmarks
performance fees
herding behaviour
high-yield investments, 2nd
hindsight bias
household savings ratio
IG bonds, 2nd, 3rd
IG credit, 2nd, 3rd, 4th
market cap indices
impact investing
income drawdown, 2nd
income generation, 2nd, 3rd
income and growth strategy
income protection insurance
income tax, 2nd
on rental profits, 2nd
index trackers, 2nd, 3rd
passive
tracking errors, 2nd, 3rd, 4th
inflation, 2nd
and asset classes, 2nd
and DB pensions
deflation
and interest rates, 2nd
and investment outcomes, 2nd
return objectives
and lifecycle investing, 2nd, 3rd
nominal and real return on, 2nd
and real assets
and residential property prices
risk, 2nd
stagflation, 2nd
inflation-linked bonds (linkers)
infrastructure investing, 2nd, 3rd, 4th, 5th
inheritance tax (IHT), 2nd, 3rd
buy-to-let properties
insurance, 2nd
insured funds
interest rates
bank deposits
Bank of England (BOE) base rate, 2nd, 3rd, 4th, 5th, 6th
interest rate risk
ISAs, 2nd
mortgages, 2nd
term structure of
Investment Association (IA)
investment bonds
investment clock
investment constraints
fund managers, 2nd
legal and regulatory, 2nd, 3rd
liquidity, 2nd
special circumstances, 2nd
taxes, 2nd, 3rd
time horizons, 2nd
investment management agreements (IMAs)
investment objectives, 2nd, 3rd
lifecycle investing
investment opportunity set
investment outcomes
annuities, 2nd, 3rd
asset classification
blending
growth, 2nd
corporate bonds
and investment strategy
hedge liabilities
income
and inflation, 2nd
required versus desired outcomes, 2nd
Investment Policy Statement (IPS)
investment spectrum
investment strategy, 2nd, 3rd, 4th
and asset allocation
governance budget
lifecycle investing, 2nd, 3rd, 4th, 5th
see also SAA (Strategic Asset Allocation)
investment trusts
investment-linked annuities
IPS (Investment Policy Statement)
ISAs (Individual Savings Accounts), 2nd, 3rd, 4th, 5th
allowance
benefits of
cash flow management
cash ISAs, 2nd, 3rd, 4th
compared with pensions, 2nd, 3rd
expected return on
hedging liabilities
Help to Buy
and inheritance tax
interest rates, 2nd
investment constraints, 2nd
and investment strategy
Junior ISAs, 2nd, 3rd
and lifecycle investing, 2nd, 3rd, 4th, 5th, 6th
lifetime
and mortgages
self-select
stocks and shares ISAs, 2nd
transferring
lagging indicators
LDI (Liability Driven Investment), 2nd
leading indicators
legal constraints on investment, 2nd
leverage
hedge funds
mortgages
liabilities
hedging, 2nd, 3rd, 4th
life expectancy, 2nd
and longevity risk, 2nd
life insurance, 2nd, 3rd
lifecycle investing
accumulation phase, 2nd, 3rd, 4th
consolidation phase, 2nd
de-accumulation phase, 2nd, 3rd
financial life plan
lifestyle funds
lifetime allowance (LTA), 2nd, 3rd
lifetime mortgages (term trackers), 2nd
limit order
linkers (inflation-linked bonds)
liquid alternatives
liquid investments
generating income from
liquidity
bonds, 2nd
constraints, 2nd
and investment strategy
investment trusts
lifecycle investing, 2nd, 3rd, 4th, 5th
and property investment
liquidity risk, 2nd
premium
listed alternatives, 2nd
local diversification
long-only funds
longevity risk, 2nd, 3rd
and lifecycle investing, 2nd
lottery winnings
lump sums
and annuities, 2nd, 3rd
from pension pots, 2nd, 3rd, 4th, 5th
market bucket
market impact
market leadership
market order
market-cap indices, 2nd
marshmallow experiment
mean-variance optimisation
mental accounting
Modern Portfolio Theory (MPT)
monetary policy, 2nd
Money Advice Service, 2nd, 3rd
money market funds (cash)
money purchase annual allowance
Morningstar, 2nd, 3rd
mortgages, 2nd, 3rd, 4th
amount you can borrow
buy-to-let, 2nd, 3rd, 4th
capital and interest (repayment mortgages)
early repayments
fees and costs
interest only or repayment
interest rates
LTV (loan-to-value) ratio
paying off, 2nd, 3rd
shopping around
types of, 2nd
MSCI World Index, 2nd, 3rd
historic performance
multi-employer pensions
MVST framework
myopic thinking
P/E (price to earnings ratio), 2nd, 3rd
passive index trackers
passive investors
path-dependent dynamic risk budgeting
peer group benchmarking
Pension Benefit Statement, 2nd
pension commencement lump sum (PCLS)
Pension Protection Fund
Pension Tracking Service
Pension Wise
pensions, 2nd, 3rd, 4th
children’s
compared with ISAs, 2nd, 3rd
drawing income from
exhaustion rates
inheritance tax (IHT)
investment constraints, 2nd
maximising contributions, 2nd
and mortgages
offshore schemes
pension pots
annual income from
growth
pensions death tax
personal pensions, 2nd, 3rd
retirement age
see also DB (defined benefit) pensions; DC (defined contribution) pensions
Pensions Advisory Service (TPAS)
Pensions and Lifetime Savings Association (PLSA)
personal pensions, 2nd
contributing to someone else’s
Phillips curve
platforms, 2nd, 3rd
portfolio management
budgets
cash flow
core-satellite construction
currency management
efficient (EPM)
implementation
rebalancing
reviewing performance, 2nd
trade orders
see also diversification; fund managers
PPP (Purchasing Power Parity)
Premium Bonds
price movement, 2nd
price return, 2nd
principal-agent problem
private equity, 2nd, 3rd
property, 2nd, 3rd, 4th
capital market assumptions, 2nd
classification of, 2nd
direct
REITs, 2nd, 3rd
rental yield, 2nd, 3rd
UK IPD TR All Property Index, 2nd
see also buy-to-let; residential property
prospect theory
random walk theory
RDR (retail distribution review)
real assets
recency effect
regret risk
regulatory constraints on investment, 2nd, 3rd
REITs (Real Estate Investment Trusts), 2nd, 3rd
relative return objectives
relative risk
replication methodology
representativeness bias
residential property, 2nd, 3rd, 4th
owning your house, 2nd
buying or renting
house prices
selling
see also buy-to-let; mortgages
retirement smile
return enhancers
returns, 2nd, 3rd
alpha, 2nd
asset classes
blended portfolios
bonds
compound return
equities, 2nd
expected
asset allocation
gross versus net return
historic performance of assets, 2nd
and investment constraints
and investment strategy, 2nd
investment versus saving
lifecycle investing, 2nd, 3rd, 4th, 5th
linking risk and return
net return and need to take risk
nominal and real return on inflation, 2nd
price return
relative versus absolute return, 2nd
return versus absolute return strategies
shortfall risk
target return, 2nd
total return (TR), 2nd, 3rd
risk, 2nd, 3rd, 4th, 5th
asset classes, 2nd, 3rd
and bank deposits
blended portfolios
budget
buy-to-let
counterparty risk, 2nd
expected
asset allocation
and expected returns
historic performance of assets
idiosyncratic
lifecycle investing, 2nd, 3rd, 4th, 5th, 6th
linking risk and return
longevity risk
management, 2nd, 3rd, 4th
market-cap indices
measuring, 2nd
absolute versus relative risk
fixed income risks
liquidity risk
risk-adjusted performance
scenario analysis
stress testing, 2nd
need to take risk
parity
regret risk
shortfall risk
systemic risk
and Tactical Asset Allocation
and time horizons, 2nd
tolerance, 2nd, 3rd, 4th, 5th, 6th
see also volatility
risk assets, 2nd, 3rd
risk diversifiers
risk premiums, 2nd, 3rd
robo-advisors
S&P 500 Index
SAA (Strategic Asset Allocation), 2nd, 3rd
dynamic, 2nd, 3rd, 4th, 5th, 6th
and passive index trackers
portfolio management, 2nd
risk budget
safe bucket
safe-haven assets
sample size bias
saving for retirement, 2nd, 3rd
how much to save, 2nd
and investment returns
see also ISAs (Individual Savings Accounts); pensions
savings, 2nd, 3rd
Schiller P/E
securities, 2nd
funds versus individual
lending, 2nd
selection bias
self-attribution bias
self-employed pensions, 2nd, 3rd
settlement period, 2nd
share classes, 2nd, 3rd
Sharia law
Sharpe ratio, 2nd, 3rd, 4th, 5th
asset allocations, 2nd
portfolio diversification, 2nd
shortfall risk
shorting
SIPP (self-invested personal pensions), 2nd, 3rd, 4th
socially responsible investing (SRI)
speculative bucket
sponsor risk
spot markets
spouses, 2nd
spread products
stakeholder pensions, 2nd
stamp duty, 2nd, 3rd, 4th, 5th, 6th
standard deviation, 2nd, 3rd, 4th
three-asset
state pension, 2nd, 3rd
statistical significance
status quo effect
Statutory Money Purchase Illustration
stocks and shares ISAs, 2nd
stop loss order
Strategic Asset Allocation see SAA (Strategic Asset Allocation)
strategic bond funds
student loans
sunk costs
survivorship bias
swaps
systemic risk
TAA (Tactical Asset Allocation), 2nd, 3rd, 4th
MVST framework
target asset allocation
target date funds (TDFs)
target return, 2nd
tax relief on pensions, 2nd, 3rd, 4th
lifetime allowance (LTA), 2nd, 3rd
taxes, 2nd, 3rd, 4th, 5th
buy-to-let
DB pensions
inheritance tax (IHT), 2nd, 3rd
and investment constraints, 2nd, 3rd
and mortgage payments
pensions death tax
professional advice on
reporting fund status
stamp duty, 2nd, 3rd, 4th, 5th
tax efficient schemes
tax-efficient savings
see also Capital Gains Tax (CGT); income tax
TER (Total Expense Ratio), 2nd
term assurance
term premium
terminal asset allocation
time horizons, 2nd, 3rd
asset allocation
investment growth over time
lifecycle investing, 2nd, 3rd, 4th, 5th
and money market funds
and risk, 2nd
total return (TR), 2nd, 3rd
tracker mortgages
trade orders
trading rules
traditional investments, 2nd
historic performance
see also bonds; equities
trusts