Capital Appreciation
The growth of your principal. If you invest $100 in a stock mutual fund and its
value increases to $120, that $20 increase is called capital appreciation.
Capital Gain
When you sell an investment for more than you paid, your profit is called a
capital gain.
Cash Balance Pension Plan
A defined benefit plan that provides for specific annual employer contributions
that accumulate at a guaranteed investment return.
Cash Balance Plan
A defined benefit plan in which each participant has an account that is
credited with a dollar amount that resembles an employer contribution,
generally determined as a percentage of pay. Each participant's account is
credited with earned interest. The plan provides the benefits in the form of a
lump-sum distribution or annuity.
Certified Financial Consultant (CFC)
Offered through the Institute of Financial Consultants.
Graduates who maintain registered membership, are authorized to use the C.F.C.
designation.
Certified Financial Manager (CFM)
This financial planning designation is offered by the Institute of Management Accountants. Candidates must meet requirements that include IMA membership, testing, experience and ethics.
Certified Financial Planner® (CFP)
Offered through the College of Financial Planning.
In order to be licensed to use the CFP trademark, an individual must meet the
following qualifications, as specified by the Certified Financial Planner Board of Standards, Inc.
Certified Investment Management Analyst (CIMA)
Offered by the Investment Management Consultants Association to investment
consultants who complete educational, examination, and experience requirements.
Continuing education is required. The Investment Management Consultants Association
offers classes at the Wharton School of Business. This designation is targeted
for fee-based advisors, financial managers, investment counsel, and trust officers. 303-770-3377
Certified Investment Management Consultant (CIMC)
The Institute for Investment Management Consultants awards this credential to financial advisors who pass two levels of NASD-administered
exams. The exam is based on the IIMC's self-study course and covers Investment Theory and the Management/Elements of Investment Consulting.
Collective Trust Fund
Works and acts much like a mutual fund. Collective trust (also known as a common trust fund) offer investors many of the same benefits as mutual funds, such as portfolio diversification,
professional management and investment flexibility. But since collective funds do not impose the same administrative fees and do not have some of the regulatory requirements that mutual funds do, they generally have lower operating expenses.
Compliance Tests
The tests most 401(k) plans must pass each year are the ADP (Actual Deferral Percentage), ACP (Actual Contribution Percentage), and
Top-Heavy. The RS-mandated tests compare contribution levels and actual amounts made by different classifications of plan participants.
