Appendix 1

Glossary

This glossary does not repeat definitions and explanations of concepts that are provided in the main text, for example in Chapter 2 (terms relating to behavioural finance) and chapters in Part 2 (for terms relating to equity markets, credit markets, hedge funds, private equity and real estate). For references to these, please consult the index.

Active management Investment strategies of active investment managers who are appointed in the expectation or hope that they will perform better than the market as a whole, after allowing for the extra fees paid for active management. These strategies always involve avoidable turnover (compared with a passive or market matching strategy) and the avoidable risk of underperforming ...

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