Watch John Bennett, Fund Manager of Henderson European Focus Trust, present on how the Trust has performed over the last financial year and his outlook for the coming months.
Beta: This measures a portfolio’s (or security’s) relationship with the overall market or any chosen benchmark. The benchmark always has a beta of 1. A portfolio with a beta of 1 means that if the market rises 10%, so should the portfolio. A beta of 0 means the portfolio’s returns are not linked at all to the market returns. A negative beta means the investment should move in the opposite direction to the market.
Gearing: A measure of a company’s leverage that shows how far its operations are funded by lenders versus shareholders. It is a measure of the debt level of a company. Within investment trusts it refers to how much money the trust borrows for investment purposes.
Delta: the ratio that compares the change in the price of an asset, usually marketable security, to the corresponding change in the price of its derivative.
Leverage: The use of borrowing to increase exposure to an asset/market. This can be done by borrowing cash and using it to buy an asset, or by using financial instruments such as derivatives to simulate the effect of borrowing for further investment in assets.
EBITDA (earnings before interest, taxes, depreciation, and amortization): is a measure of a company's overall financial performance and is used as an alternative to simple earnings or net income in some circumstances.
Return on equity (ROE): is a measure of financial performance calculated by dividing net income by shareholders' equity.
Return on capital employed (ROCE): is a financial ratio that measures a company's profitability and the efficiency with which its capital is used.