Spicers Jargon Buster
The language of investment and financial services explained.
Someone who is a registered provider of certain types of financial advice and belongs to a dispute resolution service. An adviser can be either an authorised financial adviser (AFA), who is authorised to provide advice on more complex products (such as investments); or a registered financial adviser (RFA), authorised to provide advice on straightforward financial products (such as insurance or lending). In certain situations an Adviser may be a part of a Qualifying Financial Entity (QFE) and have obligations under the oversight of that QFE. All financial advisers must comply with the requirements of the Financial Advisers Act 2008 (FA Act). This includes disclosure obligations which are set out in regulations. The compliance requirements for financial advisers depend on the type of services provided.
Approved Product List
A list of investment options (managed funds, shares, bonds) that meet our rigorous criteria for quality performance and safety.
Asset protection (insurance)
A type of insurance that covers the things you own (e.g. car, house, contents).
Tradeable possessions that have similar characteristics and market behaviours, e.g. equities (stocks, shares), fixed-income (bonds), property and cash (money market instruments).
Cash management account (CMA)
An everyday on-call account that earns interest and allows easy deposits and withdrawals on demand. You may use a cash management account as a holding account for the funds that flow into and out of your investments (e.g. regular withdrawals).
These are shares (equities, stocks) and bonds.
This is spreading your investments across a range of different managers, types of investment and/or markets. The idea is to reduce the risk of having all your investments in one asset class.
Having enough income or financial resources to do what you want to do, when you want to do it.
See financial freedom.
The process of identifying your goals and working out how you can acquire and protect the financial resources required to achieve them. It includes investment planning, asset protection, estate and tax planning.
A person, group or business responsible for investing a pool of money (a fund) within agreed boundaries and goals, such as the level of risk, the growth in value or the amount of regular income generated.
A prediction (model) of how much financial value a planned investment strategy might provide in the future.
The things you want to achieve with the support of your investments. They can be objects, experiences or actions.
The detailed plan of how your assets are to be invested over various asset classes, taking into consideration your attitude to risk and investment timeframe. Your investment strategy helps you achieve your investment goals.
A voluntary work-based savings initiative set up by the government to encourage New Zealanders to save for their retirement.
Life protection (insurance)
A type of insurance that covers the loss of life, physical ability or income.
A type of investment where a number of investors pool their money into one fund, which is then invested by a fund manager for specific goals. Units in the fund can usually be bought and sold. The value of a unit depends on the value of the total fund at the time and how many units make up the fund.
Multi asset solution
A product or service that provides risk protection and diversification by spreading your investment across a range of markets and/or asset classes (shares, bonds and cash).
More than one security (share, bond).
A collection of investments owned or managed by one entity, such as a person, trust, company or fund manager. All of your investments make up your investment portfolio.
The discipline of bringing together real-time news, commentary, data and evaluation tools to enable well-informed decision.
The process of revisiting the reasons behind previous investment decisions to ensure they are still current and optimal. It will check whether your circumstances, risk appetite or financial goals have changed. It also looks at how your investments are performing and recommends changes for you to consider (if appropriate).
Risk profile (tolerance)
The level of volatility or risk someone will accept in their portfolio. Your risk profile will consider your life stage, when you plan to ‘cash in’ your investments to support specific goals, and whether you can stick to a particular plan without losing sleep at night. This is a vital ingredient for good investment planning.
These are also commonly known as stocks or equities. A share is a unit of ownership interest in a company giving the right to dividends (income), if any.
Superannuation (New Zealand):
New Zealand Superannuation (NZ Super) is a government pension paid to eligible New Zealanders over the age of 65, no matter how much you are earning or how much you own. However, the amount you are earning can affect your tax code and therefore how much Super you receive after tax.
Another name for financial planning.
An investment platform used by Spicers that combines all investments for reporting and tax purposes. It includes an online view of your portfolio.