Refers to ownership of any property or interest in such a property (tangible or intangible).
Tangible assess are for example a car or land where as intangible assets includes unit trust or shares.
Deciding how to invest resources (typically money) in a number of differnt asset classess in rder to detemrine the asset mix that will ensure that a client's return on investment with acceptable risk levels.
This term indicates the different classes of investment assets.
- Cash (Bank account, savings accounts etc)
- Property (Individually owned, owned in a syndication, trust or company structure)
- Equity (Shares or parts of shares like unit trusts)
- Bonds (Structured debt with or without regular interest payments)
Strategies and techniques to optimise the assets in consideration of the client's requirements or constraints.
Securities that raise debt financing for private firms or public entities (Government, Eskom etc). The firms use the debt to finance their fixed or current assets.
The Bond is an undertaking by the issuer (the borrower) to the Bond holder (the lender) promising to pay interest and pay the principal at a set maturity date.
The interest of a bond is usually paid every six or twelve months.
Money deposited in an interest-bearing (Interest earning) account which may be called back on demand (withdrawn at any specific time)
Capital Gains Tax
Also known as CGT.
A tax on profits realised from buying an asset at one price and selling it at another. The tax is thus paid on the gain.
Compliance refers to the regulations that govern the Financial Services sector. The Compliance document requirements are found in the FAIS General Code of Conduct and include a disclosure letter and a record of advice.
The interest that you earned on the interest that you earned from investing your capital.
The calculation is based on the original capita as well as the interest earned on the original capital.
A regular income stream that is bought with a Pension, Provident or Retirement Annuity Fund.
Conservative generally refers to risk in an investment portfolio.
Conservative risk means that there is no, or very little investment risk associated with the investment.
An example of an investment with a conservative risk is a fixed reposit.
The possibility that the borrower will not be able to meet their debt repayment obligations.
Equity refers to the share capital and reserves , which is also equal to the net assets (Assets less liabilities).
Equity as an asset class refers to the shares bought in companies (listed and unlisted) for growth opportunities.
A method used by the short-term insurance industry, where the insured is liable for a certain part of the loss suffered with an incident.
This is also referred to the deductible or the first amount payable.
The required value of one currency to buy another currency.
FAIS Code of Conduct
The code regulates how authorised FSP's have to act, records they need to keep and what information they need to disclose when providing financial advice. The Code of Conduct forms part of the FAIS Act, and is managed by the FSCA
The duty to act honestly and in the best interest of fiduciary (the people or person's money whom they manage)
Gross Domestic Product
Also known as the GDP
The South African Economy uses the GDP to indicate the income of South Africa , disclosed annually or quarterly.
The real GDP takes into account price variations, while nominal GDP takes into account current prices.
The decline in the value of money from one year to the next.
This represents the purchasing power (what you can buy with your money) and reflects the the increase in prices in general.
The person who pays a premium in exchange for Insurance cover.
This can be for:
Short Term insurance, which refers to Car, home and valuabels insurance or;
Long Term insurance, which refers to Life, Disability and Illness Insurance.
an Essential person within a business, typically a person without whom the business would not survive.
Money Market Account
Money Market Accounts (different to Money Market Investments) are savings accounts offered by the bank that often offers a higher rate of interest and is usually available on demand (withdraw when required). The minimum to open a money market accounts are usually R 10 000 but can differ from bank to bank. The rate offered by the bank is usually linked to the prime rate.
Money Market Investment
A Money Market Investment ( different from a money market account) are based on a unit trust model, where the growth of money is largely based on the bond market.
Nominal interest rate
The rate of return expected for an investment calculated on a yearly basis.
A bank account where funds are available after a notice period. These often are 7 day or 32 days.
Also known as a demand deposit is a money market instrument that is a short-term investment in an interest-bearing account, where the funds may be requested by the client depending on the rules of the specific product.
An ombud is a presiding officer in a dispute between the client and the insurer or financial services provider. The duties of the Ombud is to consider the complaint made to them, to require all such information as they consider necessary for the proper performance of his duties, and recommend a course of action.
The ratio of savings to total income.