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Retirekit Glossary I

I


IFCD (Inflation Adjusted Certificate of Deposit)
A form of CD that compensates the investor for inflation via an adjustable coupon. This is in contrast to a TIPS or CDIP that make the inflation adjustment through the adjusting the value of the bond’s or CD’s principal. The IFCD coupon is composed of a fixed component and a portion adjusts from coupon period to coupon period that reflects the inflation during that time.

Immediate or Cancel
A time-in-force restriction that can be placed on the execution of an order. This restriction requires that a broker immediately enter a bid or offer at a limit price you specify. All or only a portion of the order can be executed. Any portion of the order not immediately completed is canceled.

Implied Volatility
For underlyings, the average volatility using options from the front two months.

For options, implied volatility is the market’s expectation of volatility for an option’s price.

Implied Volatility Change
The volatility percentage change that occurs as volatility rises or falls based on consumer expectations for an individual stock or the market in general.

In The Money
Where the underlying stock price falls relative to the option strike price. For calls, it is when the stock price is above the strike price of the option. For puts, it is when the price of the stock is lower than the strike price of the option.

Inactive – Unavailable for Electronic Funds Transfer
A Fidelity Electronic Funds Transfer; bank status indicating that the routing information for a bank could not be verified and you cannot use this bank for Electronic Funds Transfer requests.

If you see this status for a bank account, contact a Fidelity representative at 1-800-544-6666 for assistance.

Income bond
A type of corporate bond which allows the issuer to omit or delay interest payments if the firm’s earnings are determined to be too low.

Indenture
A contract that explains the various options and intricacies of a bond.

Inflation Adjusted Ask Price
Adjusted Price / Inflation Adjusted Price ((Existing definition)) In the context of inflation protected bonds such as Treasury Inflation Protected Securities (TIPS), the Adjusted Price is the price that will be used to assess the net money (the total dollar amount) of the trade. It is calculated by multiplying the Inflation Factor by the trader’s quoted prices. Because the inflation protection of a TIPS is delivered through changes to a bond’s principal, the investor is essentially paying for the cumulative inflation impact from the original issue date up until the point of purchase.

Inflation Adjusted Bid Price
Adjusted Price / Inflation Adjusted Price ((Existing definition)) In the context of inflation protected bonds such as Treasury Inflation Protected Securities (TIPS), the Adjusted Price is the price that will be used to assess the net money (the total dollar amount) of the trade. It is calculated by multiplying the Inflation Factor by the trader’s quoted prices. Because the inflation protection of a TIPS is delivered through changes to a bond’s principal, the investor is essentially paying for the cumulative inflation impact from the original issue date up until the point of purchase.

Inflation Adjusted Price w/Concession
In the context of trading securities whose principal value adjusts over time to account for inflation, such as a TIPS, the Inflation Adjusted Price with Concession equals the trading price of the security, multiplied by the inflation factor plus the per bond trading concession or fee.

Inflation Adjusted Principal
This equals the principal, or the nominal amount of a fixed income security (1 bond is typically = $1,000), multiplied by the inflation factor. It is commonly displayed when trading a security such as a TIPS where the principal value grows or accrues over time to reflect the impact of inflation that has occurred during the life of the bond.

Inflation Adjusted Third Party Price
In the context of securities whose principal value adjusts over time to account for inflation, the Inflation Adjusted Third Party Price is the closing price from the previous business day, multiplied by the inflation factor relevant for the issue date of the bond.

In Kind
Shares of an asset that are transferred without liquidating them.

Incentive Stock Options (ISOs)
A stock option with preferred tax treatment. For U.S. federal tax purposes, you do not have to pay regular income taxes when you exercise an ISO, but you must hold your shares at least one year from the date of exercise and two years from the grant date.

Inception Date
The date that the fund started operations.

Include Bonds Subject to Alternative Minimum Tax
When searching bond inventory for a bond ladder, you can choose to include municipal bonds subject to alternative minimum tax. The default is not to include these bonds.

Include Callable Bonds
When searching bond inventory for a bond ladder, you may include or exclude callable bonds in the ladder. If you include a callable bond and the bond is called, your interest payments shall cease and the principal shall be returned to you (payable as of the call date). If you seek to reinvest this principal in a similar bond issue, you will likely have to accept a lower yield (and lower interest payments) consistent with prevailing interest rates. Not all bonds are callable. You are required to select “Yes” or “No” to this question as including callable bonds may break the ladder sooner than you anticipated.

Include Existing Positions
If you own existing fixed income positions, you may include them as part of a second set of Summary Calculations. Existing positions can only be included in this Summary analysis if they are an eligible product type (i.e., Municipal or Taxable). Existing positions can be included in the Summary Calculations, however they will not be screened against any of the customer selected criteria nor are they used in the creation of your bond ladder.

Include Insured Bonds
When creating a bond ladder, select if you want to include insured municipal bonds. Default will be to include insured bonds.

Income Amount
The amount you receive as a result of a payment from an annuity.

Income/Distributions
For tax purposes, a mutual fund generally passes along dividends and interest it receives from securities it owns. A fund also passes along your share of the profits it makes when it sells securities for a higher price than it paid for them. You may choose to have these distributions sent to you or you may want to reinvest them. Distributions are subject to federal tax, and may also be subject to state or local taxes. Your distributions are taxable when they are paid, whether you take them in cash or reinvest them.

Income Source
When creating a bond ladder, this indicates the source of the funding by the issuing municipality for municipal bonds.

Income Value Per Unit
The value of an investment in a variable annuity contract.

The investment is measured in units which rise and fall each business day depending upon the investment’s performance.
If the investment is the Fidelity Fixed Income or Guaranteed Account, this value is n/a.
Income value per unit applies to annuity contracts.

Increases Last 5 Years
The number of times the amount of the dividend increased within the last five years.

Increment
The denomination in which additional bonds can be purchased (e.g., $1,000 per bond).

Incremental Investment
This refers to the incremental amounts at which you can buy additional fixed-income securities (e.g., bonds) after your initial investment. For most new issue and secondary fixed-income securities offered through Fidelity, the incremental investment is $1,000 which is equal to one bond.

For Fixed Rate Capital Securities (FRCS) which are hybrid securities issued by corporations and that trade in shares, the incremental investment is $25 which is equal to one share.

Index
An index is used to measure the changes in particular types of securities’ values (e.g., stocks).

Major stock market indexes include (where the text in parenthesis is the trading symbol for the index):


  • S&P 500 (.SPX) – Standard and Poor’s 500

  • DJIA (.DJI) – Dow Jones Industrial Average

  • NASDAQ (.IXIC) – NASDAQ Composite Index

  • Russell 2000 (.RUT) – Russell 2000 Index

  • Technology (.XCI) – AMEX Computer Technology Index

  • Internet (.IIX) – AMEX Internet Index

  • Broker/Dealers (.XBD) – AMEX Securities Broker/Dealer

  • Oil & Gas (.XIO) – AMEX Oil Index

  • Gold & Silver (.XAU) – Phlx Gold Silver Index

  • Utilities (.DJU) – Dow Jones Utilities Average

  • Transportation (.DJT) – Dow Jones Transportation Average

  • Airlines (.XAL) – AMEX Airlines Index


In a chart, you can select an index and compare the change in its value against the changes in value for a particular security.
In fixed income investing, an index is referenced in the context of a Principal Protected Note (PPN). The PPN tracks the rise and fall of a particular index and offers a return that is some percentage of the index’s appreciation as outlined in the PPN’s prospectus.

Index Funds
A passively managed, limited-expense (advisor fee no higher than 0.50%) fund designed to replicate the performance of an unmanaged stock index on a reinvested basis.

Index Ratio
Index Ratio is the “Inflation Factor” and is derived by Today’s Daily CPI / Dated Date CPI.

Index’s Full Name and Symbol
The name of the index (e.g., DJ Indu Average for Down Jones Industrial Average) and the ticker or exchange symbol used to identify the index. Index symbols begin with a period (e.g., Dow Jones Industrial Average symbol is .DJI).

Index Start Level
The value or level of the index that forms the basis of a Principal Protected Note’s (PPN) return on the issue date of the PPN. The percent gain of the index equals the index level at the PPN’s maturity minus the index start level divided by the index start level. Assuming the index appreciates over the life of the PPN, the PPN will deliver a return equal to the percentage appreciation of the index multiplied by the Participation Rate.

Indication of Interest
For new issue fixed-income offerings (e.g., bonds), this is information you submit to let Fidelity know that you want to become eligible to receive an allocation of securities.

In an indication of interest, you submit information such as the brokerage account from which the funds to pay for the securities will be deducted, the security’s CUSIP and the maximum number of securities, the quantity, that you would like to receive. By placing an indication of interest, you are participating in a new issue offering.
You must confirm indications of interest for new issue corporate bonds and Fixed Rate Capital Securities on the date and during the specified time period to be eligible for an allocation of securities. You receive this information as an alert that is sent by e-mail or pager.

Indication of Interest Confirmation Number
The unique number that identifies a confirmation for an indication of interest in a new issue fixed-income (e.g., bond) offering. Use this number when inquiring about the indication of interest.

Indication of Interest Reference Number
The unique number that identifies a particular indication of interest in a new issue fixed-income offering (e.g., bond) that you placed with Fidelity. Use this number when inquiring about the indication of interest.

Individual Directed Brokerage Account
An institutional brokerage account you opened with Fidelity through a Registered Investment Advisor that you are actively managing yourself.

Industry Sectors
On the Graphical View and Holdings Detail screens, these are the 10 industry sectors recognized by Morningstar, Inc. plus an Unknown category. Morningstar is an independent third-party provider. The Morningstar sectors include:


  • Cyclicals

  • Durables

  • Energy

  • Financials

  • Health

  • Retail

  • Services

  • Staples

  • Technology

  • Utilities


Unknown represents securities for which the industry sector information is not known. For example, if a mutual fund buys shares of a stock through an initial public offering (IPO), information on the industry sector within which the stock would be categorized may not be available.
Morningstar also provides underlying securities information for mutual funds. The holdings information includes the securities held in the fund and industry sector information.

Inflation Factor
For Treasury Inflation Protection Securities (TIPS) and Certificates of Deposit: Inflation Protected (CDIPs), it is calculated by dividing the latest Reference CPI by the Reference CPI on the Dated Date of the bond. (See Factor).

Inflation Linked Certificates of Deposit (IFCDs)
A form of CD that compensates the investor for inflation via an adjustable coupon. This is in contrast to a TIPS or CDIP that make the inflation adjustment through the adjusting the value of the bond’s or CD’s principal. The IFCD coupon is composed of a fixed component (also known as the “base rate”) and a portion that adjusts from coupon period to coupon period that reflects the rate of inflation over the past year.

Inflation Risk
The chance that the value of assets or income will be diminished as inflation shrinks the value of a currency.

Inflow
The value of cash and shares flowing into the core position of your Fidelity Retirement Income Account. This value is calculated after market close of the prior business day. It is based only on settled trades. The intent is to show inflows available for spending, so the amount is adjusted to exclude flows that are subsequently used to purchase securities. Because the adjustment occurs when the security is purchased or the cash or shares are moved to another account, inflows can be volatile if money is being positioned for security purchase.

Initial Public Offering (IPO)
This is when a company sells shares to the public for the first time. The company will thereafter be traded on an exchange or in a market (e.g., New York Stock Exchange, Nasdaq).

Institutional Percent Owned (%)
In a Company Profile, this is the percent of common stock held by all the reporting institutions as a group. It is calculated as total shares owned by institutions divided by total shares outstanding multiplied by 100.

Insured
This refers to municipal bonds where the repayment of the principal and payment of coupon interest is guaranteed by a third-party (a party other than the issuer). The insurer guarantees the payment of principal and coupon interest in the event that the issuer fails to do so.

Insurer
This refers to municipal bonds where the repayment of the principal and payment of coupon interest is guaranteed by a third-party, a party other than the issuer. The insurer guarantees the payment of principal and coupon interest in the event that the issuer fails to do so.

On the fixed-income (e.g., bond) details screen, the insurer’s name will display if the bond is insured. For example:


  • AMBAC, American Municipal Bond Assurance Corporation

  • CGIC, Capital Guarantee Insurance Company

  • FGIC, Financial Guarantee Insurance Company

  • MBIA, Municipal Bond Investor Assurance Corporation

  • FSA, Financial Security Assurance

Interest
The amount paid by a borrower as compensation for the use of borrowed money. This amount is generally expressed as an annual percentage of the principal amount.

Interest Accrual Date
For new issue fixed-income offerings (e.g., bonds), this is the date on which coupon interest will begin to accrue.

For secondary market fixed-income offerings (e.g., bonds), this is generally the date the last coupon interest payment was paid.

Interest Income
The dollar amount of all interest earned on government and corporate debt obligations and short-term certificates of deposit, as well as interest earned from cash in a brokerage account. For bond ladders, the estimated annual amount of income you will receive from the securities that make up the rung. The income is calculated by multiplying the coupon rate by the quantity of bonds (face value).

Interest on U.S. Treasury Bonds & Notes
The interest paid to this account during the specified year from U.S. Treasury Bills, Treasury Bonds, Savings Bonds, and Treasury Notes. This interest is exempt from state and local income taxes in most states.

Interest Payment Frequency
The number of times the security is scheduled to make an interest payment in any calendar year. Depending on the security and the issuer, payments could be made monthly, quarterly, semi-annually or annually.

Interest Rate
For securities on loan, the rate displayed is the current average rate of all shares of the security on loan. The rate is subject to change over the duration of the loan.

International
A security that can be traded in a non-US marketplace and settled in a foreign currency, or an asset class that invests in securities outside of the U.S. See also, Asset Class, Fixed Income, Small Cap, Mid Cap, and Large Cap.

International Funds
These funds invest in securities of countries outside the U.S. Some diversify their investments across a broad range of markets and securities, while others target a particular country or region. Targeted funds are generally more volatile than broadly diversified funds. And all foreign investments, particularly those in emerging markets, involve greater risks than those of U.S. investments.

In the Money Amount
Refers to a gain on an option contract you hold.


  • For a call option, a gain occurs when the underlying security’s current market price is greater than the option contract price

  • For a put option, a gain occurs when the underlying security’s current market price is less than the option contract price

Intraday
Activity that occurs within the day. Intraday account balances, positions, and history reflect intraday activity as of the current day’s most recent posting. As a result, account information can differ from the previous night’s posting based on intraday account activity.

Intraday account positions, history, and balances also include changes as a result of orders placed during the Premarket and After Hours sessions.

Intraday Buying Power
See Buying Power – Intraday.

Intrinsic Value
For options contracts, the in the money portion of an option’s price.

Investment
The amount of capital you are willing to pay for a debit option strategy, or the minimum credit you are willing to receive for a credit option strategy.

Investment Advisor Related Accounts
This is a section of the Portfolio screen in which all of your institutional brokerage accounts are displayed. An account is considered institutional if it is introduced to Fidelity through a financial intermediary such as a Registered Investment Advisor or Third Party Administrator.

Investment Expenses
The investor’s share of expenses of a non-publicly-offered, regulated investment company, generally, a non-publicly-offered mutual fund. The pass-through of expenses only applies in limited circumstances, and accordingly, will typically be $0.

Investment Grade or Investment Grade Bonds
The broad credit designation given to corporate and municipal bonds which have a high probability of being paid and minor, if any, speculative features. Bonds rated Baa and higher by Moody’s Investors Service or BBB and higher by Standard & Poor’s are deemed by those agencies to be “investment grade.”

Investment Objective
The identification of attributes associated with an investment or investment strategy, designed to isolate and compare risks, define acceptable levels of risk, and match investments with personal goals.

Investment Option
This term refers to the portfolios within a variable annuity or a Fidelity NetBenefits® account (e.g., Savings account (e.g.,403(b), 401(k), 457 account).


  • For a variable annuity, this is the official name and portfolio number for each investment option held in a variable annuity

  • If the investment is the Fidelity Fixed Income or Guaranteed Account, the value is n/a.

  • Fidelity has created symbols for Fidelity variable annuity investment options so that you can get quotes, view investment options in watch lists, or to view historical price charts for investment options. Fidelity variable annuity investment option symbols are only recognized by Fidelity

  • Please read about Fidelity variable annuity investment option symbols

  • For a NetBenefits account, this is the name of each underlying investment (e.g., Fidelity Asset ManagerSM) held in the account


On the variable annuity VIP Sector Fund Detail screen, the investment option shown includes the full name and fund number.

Investment Rate of Return
Commonly used to evaluate the performance of a fund or an investment manager, Investment Rate of Return measures the performance of the underlying investments and factors in any dividends, interest, or fees. However, Investment Rate of Return does not take into consideration the timing and size of your individual trades. Also referred to as “time-weighted rate” of return.

Investment Type
This is a category for stocks. There are three investment types:


For portfolio and account analysis, select Learn More About Analysis at the top of the analysis screens for more information.

IRS $100K Rule
To qualify for special tax treatments under the IRS Code, an ISO must satisfy a number of requirements at the time of grant, prior to exercise, and after exercise. As a result of these rules, certain events after an option is granted may require an ISO to be reclassified as an NSO (for example, if the option grant no longer qualifies for ISO treatment). Subsequent events could also cause an option grant that would not have previously qualified for ISO treatment to qualify (for example, certain cancellations of other ISO grants).

ISIN
This is the International Securities Identification Number. It is a 12-character alpha-numerical code that uniquely identifies a specific security. The first two characters identify the country; the third through eleventh character is the National Securities Identification Number; and the 12 character is a check digit.

Issue Date
This is the first date on which a fixed-income security (e.g., bond) could be bought.

For a new issue offering, this is generally the expected date on which the security will be allocated to those participating in the offering.

Issue Price
Price of security at initial offering.

Issued On
The date on which a margin call or day trade call was issued. You generally have five business days to settle a house, federal, or day trade call by depositing cash or securities into your account. For an exchange call, you generally have 48 hours. However, Fidelity reserves the right to meet margin calls at any time prior to the stated due date.

Issuer
A government, corporation, municipality, or agency that has issued a security (e.g., a bond) in order to raise capital or to repay other debt. For Certificates of Deposit (CDs), this is the name of the bank that has issued the CD.

For fixed-income securities, the issuer of the security is the primary determinant of the security’s characteristics (e.g., coupon interest rate, maturity, if it is callable, etc.).
For most fixed-income securities displayed on Fidelity.com, you can select the issuer’s name to see additional detail about the security (e.g., if it is callable, the coupon interest payment frequency).

Issuer Events
Issuer Events reflect information that pertains to Corporate bonds and Agencies/GSEs. They are designed to bring the investor’s attention to key changes of the status of a particular issue or underlying issuer. Examples of Issuer Events include:


  • Issuer upgrades and downgrades from major credit ratings agencies.

  • Bond placed on or removed from credit watch by major ratings agencies.

  • Bond has matured or been called.


Fidelity makes these events available to its customers for informational purposes only. The information has been sourced from third parties and Fidelity has made no independent evaluation of the information or its accuracy, completeness, or timeliness.
On the Secondary Corporate or Agency Bond Search Results Table, “IE” displays in the Attributes column if there are Issuer Events for an issue and would not display if there were none. Available Issuer Events can be viewed. Select “IE” or the issuer name to access Issuer Events.
Issuer Events are also available as part of Fidelity’s Event Alerts services. Holders of corporate and agency bonds can elect to receive an event alert to be sent to them electronically whenever an Issuer Event is generated on one of their holdings or issuers.

Issuer Name
The name of the government, corporation, municipality, or agency that has issued a fixed-income security (e.g., a bond). For Certificates of Deposit (CDs), this is the name of the bank that has issued the CD.

Issuer’s Stock
This is a share of stock that gives you ownership in a company.

Issuer’s stock and the grant of an option differ in that a grant of an option simply gives you the right to purchase shares of the underlying stock during a predefined period of time and at a pre-established price, the grant price.

Issue Size
For new issue municipal bonds and Fixed Rate Capital Securities, this is the total dollar amount of the proceeds from the sale of all securities in the offering. This dollar amount is known after the new issue is priced.

 
 
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