Page 88 - CAPE Financial Services Syllabus Macmillan_Neat

WORDS/TERMS DEFINITIONS/MEANINGS

Transaction Cost This is a fee charged by a financial intermediary such as a bank, broker,
or underwriter.

Trust Any estate or property entrusted to a trustee for safe-keeping and
administration on behalf of a third party.

Trustee Any person or firm that administers property on behalf of a third party.

United Nations (UN) Tax The United Nations Model Double Taxation Convention between
Convention Developed and Developing Countries (the United Nations Model
Convention) forms part of the continuing international efforts aimed at
eliminating double taxation.

Value at Risk (VaR) A statistical technique used to measure and quantify the level of
financial risk within a company over a specific timeframe. VaR is
measured using three variables: the amount of potential loss, the
probability of that amount of loss, and the timeframe.

Variance It measures the dispersion between an expected outcome and the
actual outcome. The statistical measure is utilised to quantify stand-
alone risk.

Wealth Management An investment advisory service that involves wealth management, tax
planning, retirement planning, estate planning, accounting or tax
services, financial and investment advice. The goal of wealth
management is to sustain and grow long-term wealth.

Wire Transfer A method of electronic funds transfer from one person or entity to
another. A wire transfer can be made from one bank account to another
bank account or through a transfer of cash at a cash office.

Yield to Maturity (YTM) The rate of return anticipated on a bond if held until the end of its
lifetime/maturity date.

CXC A38/U2/16 83