Archive for the 'S Glossary' Category

Tactical Asset Allocation (TAA)

Tactical Asset Allocation (TAA)

Tactical Asset Allocation (TAA)

An asset allocation strategy that allows active departures from the normal asset mix based upon rigorous objective measures of value. Often called active management. It involves forecasting asset returns, volatilities and correlations. The forecasted variables may be functions of fundamental variables, economic variables or even technical variables.



Post sponsored by:

Systematic risk principle

Systematic risk principle

Systematic risk principle

Only the systematic portion of risk matters in large, well-diversified portfolios. The, expected returns must be related only to systematic risks.



Post sponsored by:

Systematic risk

Systematic risk

Systematic risk

Also called undiversifiable risk or market risk, the minimum level of risk that can be obtained for a portfolio by means of diversification across a large number of randomly chosen assets. Related: unsystematic risk.



Post sponsored by:

Systematic

Systematic

Systematic

Common to all businesses.



Post sponsored by:

Synthetics

Synthetics

Synthetics

Customized hybrid instruments created by blending an underlying price on a cash instrument with the price of a derivative instrument.



Post sponsored by:

Synergistic effect

Synergistic effect

Synergistic effect

A violation of value-additivity whereby the value of the combination is greater than the sum of the individual values.



Post sponsored by:

Syndicate

Syndicate

Syndicate

A group of banks that acts jointly, on a temporary basis, to loan money in a bank credit (syndicated credit) or to underwrite a new issue of bonds.



Post sponsored by:

Synchronous data

Synchronous data

Synchronous data

Data available at the same time. In testing option-pricing models, the price of the option and of the underlying should be synchronous, representing the same moment in the market.



Post sponsored by:

Symmetric cash matching

Symmetric cash matching

Symmetric cash matching

An extension of cash flow matching that allows for the short-term borrowing of funds to satisfy a liability prior to the liability due date, resulting in a reduction in the cost of funding liabilities.



Post sponsored by:

Switching

Switching

Switching

Liquidating an existing position and simultaneously reinstating a position in another futures contract of the same type. Symmetric cash matching An extension of cash flow matching that allows for the short-term borrowing of funds to satisfy a liability prior to the liability due date, resulting in a reduction in the cost of funding liabilities.



Post sponsored by: