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ABA: American Bankers Association. National organization for all U.S. commercial banks.

Abandoned Property: Assets held in accounts that have a stop mail status, and have no owner-generated activity for a statutory period of time and for which administrative efforts to locate registered owners have failed; may be escheated to the owner's state of residence.

Account: Record of security ownership set up and maintained by a transfer agent which reflects all information about a client, his or her fund and transactions.

Accrued Dividend: Distribution which accumulates daily on a client's unpaid dividend balance and is distributed as cash or additional shares on the fund's payable date.

ADR: American Depository Receipt. Statement showing evidence that shares of a foreign-based corporation are held on deposit by a U.S. bank.

Agency Bonds: Bonds also are issued by U.S. government agencies. Some of these bonds carry a direct obligation of the Treasury, while others do not. Three types of agency bonds include Ginnie Maes, Fannie Maes and Freddie Macs.

Agency Paper: A kind of government, fixed-income security issued by entities such as GNMA, the Department of Veterans Affairs or Fannie Mae. Some government agency paper carries a government guarantee and some kinds do not.

Aggressive Growth Stock: Aggressive growth stocks appeal to investors seeking a potentially higher rate of return than growth stocks typically offer. Aggressive growth companies are generally smaller companies that have had periods of high growth rates. They tend to reinvest most of their earnings to expand and strengthen.

AGI: Adjusted Gross Income. Income before deductions used to calculate income tax liability on a federal income tax return.

Alpha Coefficient: Measures volatility where the reasons for fluctuations are due to the investment vehicle itself, not from market conditions. For example, a stock with an alpha factor of 1.25 is projected to rise in price by 25% in a year regardless of the performance of the market as a whole.

AMEX: This index is based on all common stocks, American Depository Receipts (ADRs) and warrants listed on the American Stock Exchange. It is a market value-weighted index. The base market value is adjusted to offset changes in capitalization, new listings, delistings, suspensions and cash dividends. The AMEX is a total return index with dividends reinvested.

AMT: Alternative Minimum Tax. A parallel tax system which disregards certain preferential tax treatments, created to ensure that wealthy individuals and corporations pay some income tax.

Annual Meeting: Yearly meeting of stockholders held to elect directors and to take action on other matters presented for consideration. Not generally required for investment companies.

Annual Report: Yearly record of a corporation's financial condition that must be distributed to investment company shareholders pursuant to the Investment Company Act of 1940.

Annuity: Contract between an insurance company and an individual or organization providing for periodic payment by the insurer to the annuitant for a stated period of time plus a guaranteed benefit at some future date.

Appreciation: Increase in the value of an asset such as a stock, bond, or mutual fund share over time. Also known as Growth.

APR: The Annual Percentage Rate, or APR, is not an interest rate. It is the cost of financing a loan. The APR is computed by a mathematical formula that factors in the origination fee and any maintenance fees on the loan, the estimated interest that will accrue over the life of the loan, and the length of time until repayment starts. In almost every case, the APR will exceed the current interest rate due to the amount of the fees and estimated accrued interest included in the calculation.

Arbitrage: Practice of buying and selling the same security in different markets to profit from price differences prevailing in such separate markets.

ARM: Adjustable Rate Mortgage. Mortgage loan that provides for an adjustment of the interest rate at specified times.

Ask Price: Cost of individual shares of a mutual fund equal to the net asset value plus sales charge. Also known as POP (Public Offering Price).

Asset Allocation: Weighting of a portfolio of investments among stocks, bonds and money market instruments as market conditions suggest.

Asset Allocation Funds: Asset Allocation Funds can invest in securities from all securities markets, usually with no required minimum percentages. This strategy seeks to limit market risk and to maximize overall returns by allowing for the shifting between investment categories, based on market and economic conditions as viewed by the portfolio manager.

Asset-Backed Securities: Debt instruments backed by a loan or accounts receivable originated by banks, credit card companies, or other providers of credit (does not include mortgages).

Assets: All money and property owned or owed to a corporation.

Auction Market: System where securities are bought and sold through brokers or agents on an exchange such as the New York Stock Exchange (NYSE).

Automatic Investment Plans: Systematic means for purchasing mutual fund shares at regular intervals. Do not assure profits in down markets and losses may be incurred if shares are sold at depressed prices.

Average Annual Total Return: The relative proportion of yearly total returns.

Average Effective Maturity: A weighted average of the maturities of the bonds in a portfolio, taking into account all mortgage prepayments, puts and adjustable coupons. See also Maturity.

Average Years to Call: The average number of years to the date when securities, usually bonds, can be redeemed prior to their maturities, which is known as the call date.

Average Years to Maturity: The average number of years to the date when securities, usually bonds, become due and payable, which is known as the maturity date.

Averages: Appropriately weighted and adjusted arithmetic mean of selected securities designed to represent market behavior generally or important segments of the market.