| Glossary
J to M
|
J-K |
| Junk Bonds |
|
See High-Yield.
|
| |
|
|
L |
| Large
Cap Stock |
|
A
stock with a total market capitalization greater than $5 billion.
|
| Life
Cycle Fund |
|
A
hybrid fund that invests in a mix of stocks and bonds that is
deemed appropriate for a certain type of investor (conservative,
moderate or aggressive) or a stage in life (far from retirement
or close to retirement). Also called life strategy fund. |
| Liquidity |
|
Cash
or an asset that can be sold and converted easily to cash. Money
market funds are considered highly liquid while real estate
is consider illiquid. |
| Load
Charge |
|
A
fee paid by the investor when purchasing some mutual funds that
are returned as a commission to the broker to compensate him
or her for selling the fund. |
| Lump
Sum Distribution |
|
A
withdrawal of all the funds from a 401(k) plan, which closes
the account. |
| |
|
|
M |
| Market
Risk |
|
The
chance that the price of one security will be affected by the
movement in prices of all the other securities in a market.
|
| Market
Timing |
|
An
investment strategy that seeks to predict the future movement
of market prices and invest to take advantage of those price
movements. |
| Matching
Contributions |
|
See
Company Match. |
| Maturity
|
|
The
date when a security expires and, if required, a final payment
is made to the investor. |
| Micro
Cap Stock |
|
A
stock with a total market capitalization less than $500 million.
|
| Mid
Cap Stock |
|
A
stock with a total market capitalization between $1 billion
and $5 billion. |
| Money
Market Fund |
|
A
portfolio of securities that invests in only short term debt
of high quality and liquidity. Usually the asset value of the
fund remains constant at $1, with the interest rate rising or
falling to reflect market conditions. |
| Mortgage
Fund |
|
A
fund that invests in real estate mortgages or securities that
represent real estate mortgages. |
| Mutual
Fund |
|
An
investment company that sells shares and uses the proceeds to
purchase securities in accordance with a published set of guidelines
and objectives. All the mutual funds found in 401(k) plans are
open-ended, which means the investment company will buy or sell
investors shares on a daily basis based on that day's market
price for all of the fund's securities. |
| Mutual
Fund Prospectus |
|
See
Prospectus. |
| Mutual
Fund Window |
|
A
401(k) investment option that allows the participant to invest
in any publicly traded mutual fund. |
