In the investment industry, indexes represent price movements of entire markets. For example, the Dow Jones Industrial Average and the S&P 500 Index are relatively familiar indexes representing the price movements of the US stock market, while there are other indexes such as the Citigroup World Government Bond Index which represents the price movements of the bond market. Other indexes, for example, represent the price movements in the commodities market.

The virtual index funds used for investment in the Country Pick competition are funds linked to indexes created by a company called MSCI Inc. These represent the price movements in the equity markets of each country and region in the Country Pick investment universe.

This is a fund that aims to achieve investment returns that match the movements of an index (an index representing price movements in the equity or fixed income markets).

Country Pick invests in index funds linked that aim to match the price movements in the equity markets in each country and region in the investment universe. For example, the NAV of the Brazil Index Fund changes in accordance with the MSCI Brazil Index, an index that represents the price movements of Brazilian stocks.

In contrast, there are funds managed with the goal of achieving investment returns that exceed a particular stock index (known as “active fund management”).

MSCI Inc. is a company headquarted in the U.S. In the Country Pick competition, participants compete with one another based on the performance of portfolios composed of funds linked to indexes created by MSCI. These indexes represent the price movements in the equity market of each country and region in the investment universe.

* MSCI Inc. owns all copyrights, intellectual property rights and other rights related to the indexes created by MSCI Inc. MSCI Inc. also reserves the right to modify the content of the indexes and to discontinue the publication of such indexes.

Just as stock prices represent the value (market prices) of equities, net asset values, or NAVs represent the value (market prices) of mutual funds. Therefore, investors buy and sell mutual funds based on their NAVs.

Explained further, the NAV can be calculated by evaluating the assets contained in mutual funds (the “trust assets”), deducting liabilities, such as trust fees, from the evaluated amount (which gives us the “net assets”), and dividing the net assets by the number of units. In other words, the NAV is equal to net assets per unit.

In general, the NAV is converted into the value per 10,000 units when shown in newspapers or on websites.

Weightings refer to the ratio of the total assets under management accounted for by the value of each asset invested in. For example, if you invest US $2 million in the Brazil Index Fund out of a total of US $10 million in assets under management, the weighting will be 20% (US $2 million divided by US $10 million).

This term refers to the fees to be incurred during the period in which mutual funds are held by customers. Trust fees are paid as fees for each of the services provided by distributors, fund management companies and custodians, in connection with the management of mutual funds. Although trust fees are indicated at an annualized rate, the fees are not collected once a year, but instead a day’s trust fees are deducted from the mutual fund assets on every business day.

The distributors are companies such as securities companies and banks which act as an intermediary in distributing mutual funds. Fund management companies are companies such as Nikko Asset Management which manage mutual funds. The custodians are banks that manage mutual fund assets (banks that provide trust services).

This term refers to a function that allows the switching of mutual funds without any charges as a rule as long as they are within the same group of funds.

This term refers to the index which is used as a target for fund management when managing mutual funds.

The countries targeted for investment in the Country Pick competition represent index funds that are managed in order to be linked to specific stock price indexes (referred to as “index management” or “passive management”).

In addition, the benchmark is used not only as a target in managing mutual funds but also as a basis in measuring the investment performance.

Although the word portfolio is described as “a folder” or “a briefcase for documents” in dictionaries, when the term is used in an investment context it refers to a combination of several investment assets and securities such as stocks and bonds. The term can be used in sentences like, “Your portfolio is balanced as the countries you have invested in are broadly diversified.” or “My portfolio needs rebalancing as the ratio of Japanese equities is too high.”

This term refers to the act of selling some investment targets and buying different investment targets when reviewing a portfolio’s composition.

The rights of intellectual property, such as copyrights, etc., and other rights relating to the indexes used on this website are exclusively those of the creators and publishers of each index.