Association Française de la Gestion financière (link for website here)


Alpha measures the performance of a portfolio against its benchmark. A negative alpha means that the fund has performed worse than its indicator (eg : the indicator has increased by 10% in one year and the fund has only increased by 6% : its alpha is equal to -4%). A positive alpha characterizes a fund that has outperformed its indicator (eg : the indicator has increased by 6% in one year and the fund has increased by 10%: its alpha is equal to +4%).


Beta measures the relationship between changes in net asset values of funds and changes in levels of its benchmark. A beta of less than 1 indicates that the fund “dampens” fluctuations in its index (beta = 0.6 means that the fund increases by 6% if the index increases by 10% and falls by 6% if the index falls by 10%). A beta greater than 1 indicates that the fund “amplifies” the fluctuations of its index (beta = 1.4 means that the fund increases by 14% when the index increases by 10% but also falls by 14% when the index falls 10%). A beta less than 0 indicates that funds reacts inversely to changes in its index (beta = -0.6 means the fund down 6% when the index rose by 10% and vice versa).


Company value on the stock exchange at a specific time. It is obtained by multiplying the number of shares of a company by its stock market price.


The duration of a bond is the sensitivity of its return by changes in interest rates.


ESG means using Environmental, Social and Governance factors to evaluate companies on how far advanced they are with sustainibility.

European taxonomy

The taxonomie for sustainable finance is a set of regulations put in place to regulate socially responsible investment in Europe.

High Yield

This is a bond or loan with a rating lower than the “Investment grade” category, due to its higher risk of default. The rate of return on these securities is generally higher.

Investment grade

This is a bond or loan with a rating of AAA to BBB- assigned by rating agencies, indicating a generally relatively low risk of default.

Mutual fund

A mutual fund a type of financial vehicle made up of a pool of money collected from many investors to invest in securities like stocks, bonds, money market instruments and other assets.


It is the rating used to measure the quality of : 

  • the borrower’s signature (bond issuer)
  • companies ESG standards

The ratings are published by rating agencies and provide investors with reliable information on the risk profile attached to a debt and ESG benchmarks.


Corporate Social Responsibility is defined by the European Commission as the voluntary integration by companies of social and environmental concerns into their business activities and their relationships with stakeholders.


Sustainable Finance Directive Regulation.
It is an European regulation that places transparency in terms of sustainability at the heart of the requirements, at the level of entities and funds.

Sharpe ratio

Sharpe ratio measures excess profitability over the risk-free rate divided by the standard deviation. It is a measure of marginal return per unit of risk. A higher number indicates more risk-taking is rewarded. A negative Sharpe ratio does not necessarily mean the portfolio performed negatively, but that it was lower than a risk-free investment.


The sensitivity of a bond measures the risk induced by a given change in interest rates. A two rate sensitivity means that for a 1% increase in rates, the portfolio value would decrease by 2%.


Undertakings for Collective Investments in Transferable Securities

Investment rate / exposure rate

The investment rate corresponds to the amount of invested assets expressed as a% of the portfolio. The exposure rate corresponds to the investment rate, to which is added the impact of derivative strategies. It corresponds to the percentage of real assets exposed to a given risk. Derivative strategies may aim to increase the exposure (energisation strategy) or reduce the exposure (immunisation strategy) of the underlying asset.

Net Asset Value

Net Asset Value is the net value of an investment fund’s assets less its liabilities, divided by the number of shares outstanding and is used as a standard valuation measure.


Value at risk (VaR) represents the maximum potential loss of an investor on the value of a portfolio of financial assets given a holding horizon (20 days) and a confidence interval (99%) . This potential loss is represented as a percentage of total portfolio assets. It is calculated from a sample of historical data (over a period of 2 years).


Amplitude of variation in the price / quotation of a security, fund, market or index that measures the extent of risk over a given period. It is determined by the standard deviation which is obtained by calculating the square root of the variance. The variance being calculated by averaging the deviations from the mean, all squared. The higher the volatility, the greater the risk.

Yield to maturity

Yield to maturity corresponds to the notion of actuarial rate of return. This is, at the time of the calculation considered, the rate of return offered by a bond in the event that it is held until maturity by the investor.