Defined terms for the annuity market and lifetime income landscape.
Deterministic versus stochastic projection is the analytical choice between projecting future outcomes as a single result from fixed inputs and projecting them as a distribution of results from inputs drawn from probability distributions.
Discount rate is the annualized rate used to convert a future amount to its present value, reflecting the return that could otherwise be earned on money held today over the period between now and when the future amount arrives.
Drawdown is the percentage decline in a portfolio's value from a prior peak to a subsequent trough, measuring how far the portfolio has fallen from its best previous level at any given point.
Duration is a measure of how much a bond's price will change when interest rates change, expressed in years and equal to the average time until the bond's cash flows are received.
Future value is the amount that a sum of money held today will grow to at a specified future date, given an assumed rate of return over the intervening period.
