Yield
On the date of issue of a security or investment contract, the yield refers to the coupon or interest on the security or contract. On any date after issuance, the yield of a security is based on the value of the security’s cash flows. Yield can be calculated in several ways. In general, the most common method is […]
American Institute of Certified Public Accountants (AICPA)
The AICPA is the accounting profession’s largest member association, representing many areas of practice, including business and industry, public practice, government, education and consulting. The AICPA sets ethical standards for the profession and U.S. auditing standards for audits of private companies, nonprofit organizations and federal, state, and local governments. The AICPA issued Statement of Position (SOP) […]
Buffer Fund
See liquidity buffer.
Credit Quality Downgrade
A reduction in an organization’s or financial instrument’s credit quality rating as published by a NRSRO. A credit downgrade indicates the NRSRO’s view that the financial strength of the organization or financial instrument has deteriorated.
Equity Wash
A provision in a stable value investment option that requires any transfer a participant makes from the stable value investment option to a competing option to first be directed to any other investment option not designated as a competing option for a period of time (usually 90 days).
Group Annuity Contract
A contract issued by an insurance company that allows a tax-qualified plan to purchase retirement annuities for plan participants. Most guaranteed investment contracts are group annuity contracts.
Liquidity Buffer
Investments, typically a money market fund or STIF, in a stable value investment option that may be used as a first source of liquidity to absorb immediate cash flow needs without requesting withdrawals from other stable value investment option assets.
Office of the Comptroller of the Currency
See Comptroller of the Currency, Office of.
Risk
There are many types of risk in finance, but in general it is the probability of actual returns being less than expected returns. Investors should always carefully consider an investment’s objectives, risks, and fees before investing. Although stable value investment options generally seek to preserve investor capital, provide liquidity, and generate a steady, positive return, it is important to recognize that […]
