Investing glossary of terms

31. Life-cycle funds -- A balanced fund targeted to a specific retirement date. The fund manager adjusts the proportions of the asset classes in relation to the fund's time horizon, leaning more heavily toward conservative investments as retirement nears.

32. Lifestyle fund -- An investment meant to be the only holding in a portfolio. They are comprised of a mix of assets targeted to an investor's age, goals and risk tolerance. They are different from life-cycle funds, which automatically shift assets to more conservative investments as the target date of a fund approaches.

33. Load -- A load is a sales charge or commission paid to a broker or sales intermediary, not to the fund. A load that is paid upfront at the time of purchase is called the front-end load. One that is paid upon selling shares held for less than a specified period of time is called the back-end load or contingent deferred sales charge.

34. Market capitalization -- The market value of a company's shares of stock. It is calculated by multiplying the number of outstanding shares by the current market price.

35. Midcap -- A company with a market capitalization between $2 billion and $10 billion.

36. Money market fund -- A fund that invests in short-term debt instruments such as Treasury bills, commercial paper and large CDs. The net asset value is maintained at $1.

37. Moving Average -- A technical term meaning the average price of a security over a specific time period used to spot pricing trends by flattening out large fluctuations.

38. Mutual fund -- An investment that pools together money from many different investors and puts it into stocks, bonds and other securities or a combination of the three. Mutual funds offer professional management and diversification.

39. Net asset value -- The value of one share of a mutual fund.

40. No-load fund -- A fund with no sales charge.

41. Passively managed -- A fund that emulates a market index instead of actively pursuing an investing scheme to beat the market.


42. Prospectus -- An official document that details the fund's objectives, history, manager background and financial statements.

43. Put option -- A put option on a common stock gives the owner of that option the right, but not the obligation, to sell 100 shares of the stock at a set price, called the strike price, on or before the expiration date of the option.

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