Discover what various financial terms mean, from Fund Managers to Globalisation.
Fund managers
Called 'investment advisers' in the US, these people or firms manage billions in assets (shares, bonds, property) on behalf of others. They decide on what to buy and sell and when. Fund managers typically have a team of analysts advising them on their investment decisions.
Fidelity Investments in the US and Barclays Global Investors in the UK are among the world's biggest fund managers in a global industry that manages trillions of dollars, euro, pounds and yen.
Futures
These exist for a range of real and financial commodities. Take pork bellies. Let's say they're worth £100 a tonne now, but Trader Joe thinks that the price will go up. Trader Bill, however, believes the price will go down.
They make a futures contract in which Bill agrees to sell to Joe 10,000 tonnes of pork belly at £100 a tonne in three months. At the end of that time, the price has risen to £150 a tonne. Now Bill has to sell Joe 10,000 tonnes of pork belly at £100 a tonne, as agreed, but Bill can buy pork belly at only £150 a tonne and so is going to lose £50 a tonne, or £500,000. Joe, however, has guessed right and can sell his pork belly at a profit. These futures contracts, like shares or bonds, have their own market.
Globalisation
This is the integration of national financial markets into one single global system in which capital travels across borders freely. Opening up international trade in a globalised world has helped many countries grow far more quickly than they would have otherwise done. Export-led growth has lifted millions out of poverty in Asia and particularly China.
Anti-globalisation protesters criticise industrialised countries for wanting to prise open markets in developing countries while maintaining barriers on agricultural goods that disadvantage poor farmers, particularly in Africa.
