Allocation

The future.

Whakataukī:

‍Ko ngā pae tawhiti whaia kia tata, ko ngā pae tata, whakamaua kia tina — The potential for tomorrow depends on what we do today

Auto-invest is a set and forget investment strategy where investors can set up an automatic buy order that's placed at the same time every week, fortnight, month or quarter. The invested money can help grow a diversified portfolio without an investor needing to make continuous decisions on what companies, ETFs or REITs to invest in. It’s a hands-off investment approach that can be a straightforward and efficient way to grow a portfolio over time. Read more about setting up auto-invest here.

The Australian Securities Exchange (ASX), based in Sydney in Australia, consistently ranks among the top global stock exchanges. It is the combined Australian Stock Exchange and Sydney Futures Exchange, which merged in 2006, and is a share market, clearinghouse and payments facilitator. Read more about The ASX 200: Australia’s main stock market index.

Assets under management (AUM) represent the total market value of investments managed by an individual or financial institution on behalf of their clients. AUM includes stocks, bonds, real estate, and other assets. It’s a key metric to assess the size and success of investment firms. Higher AUM can indicate trust and experience. AUM is useful for investors in helping them understand the scope and reliability of a fund or investment manager. Many investment products charge management fees as a percentage of AUM. For financial advisors and portfolio managers, fees are usually based on a percentage of their customer’s personal assets under management. This means that fees can be higher if the company manages a larger AUM, as the fee charged is a proportion of the company’s total assets that are being managed.

Assets under administration (AUA) refers to the total value of assets that a financial institution looks after for clients. These assets are owned by the clients themselves, not the institution. The institution provides services like accounting, tax reporting, infrastructure, and custody for the assets. Unlike assets under management (AUM), where the institution actively manages the investments, AUA doesn’t involve making investment decisions. AUA fees are calculated as a percentage of the amount of money the institution administers for their clients, so, the more money invested, the higher the fees.

An asset is defined as anything that holds monetary value. Anything owned or owed is an asset. An asset class is a group of investments that share similar properties or regulatory requirements. Stocks, real estate, cash and cryptocurrency are types of asset class. Investing in multiple asset classes is a common way for investors to diversify their portfolio.

Each year shareholders meet with company directors and executives to hear updates about the company’s performance, finances and future operations. An AGM is a forum to ask questions, and to vote on key decisions, such as board elections, and review financial reports. In corporate governance, AGMs are important for maintaining transparency, open communication and shareholder engagement.

Analyst ratings, or ratings, are the findings made by analysts about the value of a company’s stock. Ratings can help investors decide whether to buy, sell, or hold an asset, like a company shares. Analysts look at financial performance, industry trends, and a company’s management. Ratings can range from ‘buy’, ‘sell’ or ‘hold’, which may help investors make their investment decisions.

An analyst is a financial professional who reviews publicly listed companies on share markets and decides whether their stock is worth investing in, sometimes giving them ratings. Analysts read a company’s financial statements, listen to their quarterly earnings calls, and may talk with a company’s management or largest customers. Their analyses can help investors make informed decisions about whether to buy, sell, or hold securities like shares.

Some stock symbols are followed by '- ADR’, indicating they are American Depositary Receipts (ADRs). An ADR is a certificate issued by a US depositary bank and is generated when the bank buys shares in a non-US company and repackages them for investors to buy on a US market. Each ADR share represents a specific number of shares in a company. Learn more about ADRs.

When applications for shares are received for an IPO, the listing company and their advisers work out how many shares applicants may receive and at what price - called an allocation. An IPO might be ‘oversubscribed’, meaning there are more applications than there are shares available to be allocated. If so, people hoping to invest in an IPO may receive less than, or none, of the shares they applied for.

An active investment strategy is when investment firms or investors try to beat an index using research, forecasting and experience of companies and share markets to make decisions. Clients may pay fees for this expertise, or frequent trading. Some supporters believe that when the share markets dip, active management may limit impacts because of active decision making by real people as opposed to passive funds that simply track the market down.