With respect to an investment (e.g., a bond, stock, or fund share), market value is the cash value that selling such investment at a given price in the open market generates. As prices for investments tend to fluctuate daily, the actual or implied market value of an investment will likewise tend to fluctuate daily. With respect to a portfolio of securities, many custodians, trustees, and investment managers use independent pricing services to periodically value investment holdings and, therefore, in the aggregate, determine the market value of a portfolio.
The adjustment to an investment contract’s market value due to employer-initiated events, impaired securities, or market value events. Alternatively, for some GICs, the adjustment (sometimes known as a surrender charge or surrender value adjustment) to a GIC’s market value due to termination prior to the stated maturity date.
Any event or occurrence outside the normal operation of a plan that may be expected to have an adverse financial effect on the issuer of a stable value investment contract. When such an event occurs, some investment contracts require benefit payments to be made at the contract's market value or surrender value, rather than at book value. Other investment contracts may require a book value adjustment. (See also employer-initiated event.)
A stable value investment strategy that employs a portfolio of actively managed assets but the associated investment contract either may have a defined maturity date or may not have a defined maturity date but allows periodic payments of principal and interest from the assets for liquidity purposes. (Compare to buy and hold and constant duration.)
The date the principal amount of an obligation is payable.
A mutual fund that seeks to maintain a constant net asset value (NAV) of $1 per share while earning a market interest rate for shareholders. Such funds are regulated by the SEC and are comprised of short-term (typically less than one year) securities representing high-quality, liquid debt and monetary instruments. The term may also be used to refer to a Short-Term Investment Fund (STIF), which is a non-mutual fund form of money market fund.