Brainscape's Knowledge GenomeTM


Top Flashcards (Certified)
All Flashcards

CFA Prep > GIPS Glossary > Flashcards

GIPS Glossary Flashcards

(86 cards)

Start Studying
1
Q

Accrual Accounting

A

The recording of financial transactions as they come into existence rather than when they are paid or settled.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

Additional information

A

Information that is required or recommended under the GIPS standards and is not considered supplemental information.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

Administrative fee

A

All fees except for trading expenses and investment management fees. For example Legal fees, consultation

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

All-in fee

A

A client specific type of bundled fee

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

Benchmark

A

A point of reference against which the composite’s performance and/or risk is compared.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

Benchmark description

A

General info on investment structure. Name and key feature must be present

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

Bundled fee

A

Investment Management + Trading Expense + Custody + Admin Fees. 2 types exist

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

Capital employed

real estate

A

Weighted Average Equity, No income return or capital return measured

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q 
Capital return 
(real estate)
A

The change in value of assets held through meusrement period. Represented as a percentage of Capital Employed

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q 
Carried interest
(real estate and private equity)
A

The profits that general partners are allocated from the profits on the investments made by the investment vehicle. Also known as “carry” or “promote.”

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

Carve-out

A

A portion of a portfolio that is by itself representative of a distinct investment strategy. It is used to create a track record for a narrower mandate from a multiple-strategy portfolio managed to a broader mandate.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

Closed-end fund

real estate and private equity

A

Committed Capital, # of investors and life of fund are fixed.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

Committed capital

real estate and private equity

A

Pledges of capital to an investment vehicle by investors or firms

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

Compliant Presentation

A

A presentation aimed for a composite which includes GIPS standard and supplementary material

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

Composite

A

An aggregation of one or more portfolios managed according to a similar investment mandate, objective, or strategy.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

Composite creation date

A

The date when firms group one or more portfolios

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

Composite inception date

A

The initial date of composite performance record

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

Composite definition

A

Detailed criteria that determine the assignment of portfolios to composites. Asset class, target risk metrics, taxes

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
19
Q

Composite description

A

Must include key features. Prospective client must understand investment mandate, objective and strategy

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
20
Q

Composite termination date

A

The date that the last portfolio exits a composite.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
21
Q

Custody fee

A

The fees payable to the custodian for the safekeeping of portfolio assets. Can be based per transaction. Additional charges regarding safekeeping can be included

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
22
Q

Direct investments

private equity

A

Investments made directly in private equity investments rather than investments made in fund investment vehicles or cash and/or cash equivalents.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
23
Q

Distinct business entity

A

A unit, division, department, or office that is organizationally and functionally segregated from other units, divisions, departments, or offices and that retains discretion over the assets it manages and that should have autonomy over the investment decision-making process.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
24
Q

Distribution

real estate and private equity

A

Cash or stock distributed to limited partners (or investors) from an investment vehicle. Distributions are typically at the discretion of the general partner (or the firm).

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
25
Evergreen fund | private equity
An open-end fund that allows for on-going subscriptions and/or redemptions by investors.
26
Ex-ante
Before the fact.
27
Ex-post
After the fact.
28
External cash flow
Capital (cash or investments) that enters or exits a portfolio.
29
External valuation | real estate
An assessment of value performed by an independent external third party who is a qualified, professionally designated, certified, or licensed commercial property valuer/appraiser.
30
Fair value
The amount at which an investment could be exchanged in a current arm’s length transaction between willing parties in which the parties each act knowledgeably and prudently. Must include accrued income
31
Fee schedule
The firm’s current schedule of investment management fees or bundled fees relevant to the particular compliant presentation
32
Final liquidation date | real estate and private equity
The date when the last portfolio in a composite is fully distributed.
33
Fund of funds | private equity
An investment vehicle that invests in underlying investment vehicles.
34
General partner | real estate and private equity
A class of partner in a limited partnership. The general partner (GP) retains liability for the actions of the limited partnership. usually fund manager and earns a fee from LP
35
Gross-of-fees
The return on investments reduced by any trading expenses incurred during the period
36
Gross-of-fees | real estate and private equity
The return on investments reduced by any transaction expenses incurred during the period.
37
``` Income return (real estate) ```
The investment income earned on all investments during the measurement period net of all non-recoverable expenditures, interest expense on debt, and property taxes. Percentage of Capital Employed
38
Internal dispersion
A measure of the spread of the annual returns of individual portfolios within a composite. Can be high/low range and standard deviations
39
Internal valuation | real estate
A firm’s best estimate of value based on the most current and accurate information available under the circumstances. Can include DCF and sales comparison
40
Investment management fee
A fee payable to the firm for the management of a portfolio. Can be asset/performance based
41
Large cash flow
The level at which the firm determines that an external cash flow may distort performance if the portfolio is not valued
42
Limited partner | real estate and private equity
limited partners are generally protected from legal actions and any losses beyond their committed capital.
43
Limited partnership | real estate and private equity
Limited partnerships are usually fixed life investment vehicles. The general partner manages the limited partnership pursuant to the partnership agreement.
44
Market value
The price at which investors can buy or sell an investment at a given time X by the quantity held + any accrued income.
45
Must
A provision, task, or action that is mandatory or required to be followed or performed
46
Must not
A task or action that is forbidden or prohibited.
47
Net-of-fees
The gross-of-fees return reduced by investment management fees (including performance-based fees and carried interest).
48
Open-end fund | (real estate and private equity
Another term for Evergreen Fund
49
Paid-in capital | real estate and private equity
Capital inflows to an investment vehicle. Equal to the amount of committed capital that has been drawn down since inception. Also includes re-distributions !
50
Performance-based fee
Type of fee based a benchmark
51
Performance examination
A detailed examination of a specific composite’s compliant presentation by an independent verifier.
52
Periodicity
The length of the time period over which a variable is measured
53
Pic multiple | real estate and private equity
Since inception paid-in capital divided by cumulative committed capital.
54
Portfolio
An individually managed group of investments. A portfolio may be an account or pooled investment vehicle.
55
Primary fund | private equity
An investment vehicle that makes direct investments rather than investing in other investment vehicles.
56
Private equity
nvestment strategies include, but are not limited to, venture capital, leveraged buyouts, consolidations, mezzanine and distressed debt investments, and a variety of hybrids, such as venture leasing and venture factoring.
57
Proprietary assets
Investments owned by the firm, the firm’s management, and/or the firm’s parent company that are managed by the firm.
58
Prospective client
Person/Entity expressed interest in composite and is eligible
59
Public market equivalent (pme) | private equity
The performance of a public market index expressed in terms of an internal rate of return (IRR), using the same cash flows and timing as those of the composite over the same time period. Can be a benchmark
60
Real estate
Wholly owned, partial operated, REITs, REOCs, Equity-oriented debt
61
REITs
Real Estate Investment Trusts
62
REOCs
Real Estate Operating Companies
63
``` Realization multiple (dpi) (real estate and private equity) ```
Since inception distributions divided by since inception paid-in capital.
64
Recommendation
A suggested provision, task, or action that should be followed or performed. Best practice not requirement
65
Residual value | private equity and real estate
The remaining equity that limited partners (or investors) have in an investment vehicle at the end of the performance reporting period.
66
RVPI | real estate and private equity
Residual value divided by since inception paid-in capital.
67
Secondary fund | private equity
An investment vehicle that buys interests in existing investment vehicles.
68
Settlement date accounting
Recognizing the asset or liability on the date when the exchange of cash and investments is completed.
69
Significant cash flow
The level at which the firm determines that a client-directed external cash flow may temporarily prevent the firm from implementing the composite strategy. Must be a determined fixed amount
70
Since inception | real estate and private equity
From the initial cash flow of a composite.
71
Since inception internal rate of return (SI-IRR)
The SI-IRR is always annualized except when the reporting period is less than one year, in which case the SI-IRR is not annualized. A special case IRR that equates PV of cash flows
72
Standard deviation
A measure of the variability of returns. As a measure of historical risk, standard deviation quantifies the variability of the composite and/or benchmark returns over time
73
Sub-advisor
A third-party investment manager hired by the firm to manage some or all of the assets for which a firm has investment management responsibility.
74
Temporary new account
An account for temporarily holding client-directed external cash flows until they are invested according to the composite strategy or disbursed. Used to reallocate Significant Cash Flows
75
Time-weighted rate of return
A method of calculating period-by-period returns that negates the effects of external cash flows
76
Total firm assets
Total firm assets includes assets assigned to a sub-advisor provided the firm has discretion over the selection of the sub-advisor. Includes discossairy and non-discossairy
77
Total return
The rate of return that includes the realized and unrealized gains and losses plus income for the measurement period.
78
``` Total return (real estate) ```
The rate of return, including all capital return and income return components, expressed as a percentage of the capital employed over the measurement period.
79
Total value | real estate and private equity
Residual Value + Distributions
80
Trade date accounting
Recognizing the asset or liability on the date of the purchase or sale and not on the settlement date. 3 day window for entry OK with GIPS
81
Trading expenses
The actual costs of buying or selling investments. Broker, Bid-Offer spread.
82
Transaction expenses | real estate and private equity
All actual legal, financial, advisory, and investment banking fees related to buying, selling, restructuring, and/or recapitalizing portfolio
83
Verification
An independent verifier asses if firm follows Composite Construction and Present Performance with GIPS standards
84
Vintage year (Method 1)
the year of the investment vehicle’s first drawdown or capital call from its investors;
85
Vintage year (Method 2)
the year when the first committed capital from outside investors is closed and legally binding.
86
Wrap fee
Type of bundled fee and are specific to a particular investment product. includes trading expenses that cannot be identified separately

CFA Prep (1 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2025 Bold Learning Solutions. Terms and Conditions