A unit of a fund or collective investment scheme equal to 1% of 1%, or 1 / 10,000th, of the fund's total NAV.
Authorised ETF participants accumulate baskets that include all of the securities tracked by a specific index. The baskets then become creation units for an ETF that tracks that index.
A standard against which the performance of a security, mutual fund or investment manager can be measured. Generally, broad market and market-segment stock and bond indexes are used for this purpose. By tracking a benchmark, a fund can provide an investor with a return on a market rather than a specific company or stock.
A measure of the volatility, or systematic risk, of a security or a portfolio in comparison to the market as a whole. Beta is used in the capital asset pricing model (CAPM), a model that calculates the expected return of an asset based on its beta and expected market returns. Passive products like State Street SPDR ETFs aim to provide a beta close to one, meaning that they are supposed to deviate as little as possible from their underlying index returns.
The price a prospective buyer is prepared to pay at a particular time for trading a unit of given security.
Buying on the Margin
Purchasing an asset by making a down payment (called the margin) and financing the balancing amount through a loan by using the asset as the collateral (such as in a mortgage loan). In securities trading, only a down payment is required because the value of the securities themselves (which remain in the possession of the broker or seller) fully collateralises the unpaid amount.