HYCB July update glossary

Term Definition
Actively managed An approach to investing whereby capital is allocated according to the judgment of the investor or fund manager(s). The active investor aims to beat the returns from the stockmarket or specified index/sector, rather than to match them.
Credit The borrowing capacity of an individual, company or government. More narrowly, the term is often used as a synonym for corporate bonds.
Diversification The practice of investing in a variety of assets. This is a risk management technique where, in a well-diversified portfolio, any loss from an individual holding should have less impact on the overall portfolio.
High yield bonds Bonds with a low credit rating from a recognised credit rating agency. They are considered to be at higher risk of default than better quality, ie, higher-rated bonds, but have the potential for higher rewards.
Issuer An entity that sells securities, such as bonds and equities.
Valuation The worth of an asset or company based on its current price