GLOSSARY

SPI Futures

The SPI 200 Futures contract is an equity index futures contract which tracks the pre-tax performance of the S&P/ASX 200 Index. It provides all the traditional benefits of equity index derivatives and is ranked in the top 10 equity index contracts in Asia in terms of traded volume.

Systematic investment style

This refers to investors who select stocks in a systematic, rather than an ad-hoc manner, often analysing ratios such as Price/Earnings to measure the underlying value of a stock or accounting ratios to measure a stock’s quality.

Tax exempt investors

Tax exempt investors refers to investors who don’t have to pay tax on their income.  The most common tax-exempt investors are superannuation investors in ‘pension phase’ and charities.

Underweight positions

An underweight position in one where a fund or portfolio does not hold as much of a particular security when compared to the weight of that security held in the underlying benchmark portfolio. Underweight can also refer to an analyst’s opinion regarding the future performance of a security in scenarios where it is expected to […]

Unhedged

When a managed fund, such as a global shares fund, is unhedged, investors are exposed to fluctuations in the currencies of its underlying investments. When an overseas portfolio is fully hedged, the investment manager is uses currency futures to offset the impact of currency fluctuations on the portfolio.

Volatility

Volatility measures the risk of a security. Volatility indicates the pricing behavior of the security and helps estimate the fluctuations that may happen in a short period of time. If the prices of a security fluctuate rapidly in a short time span, it is termed to have high volatility. If the prices of a security […]