Defined terms for the annuity market and lifetime income landscape.
TIPS, or Treasury Inflation-Protected Securities, are U.S. government bonds whose principal value adjusts with changes in the Consumer Price Index, producing a stream of coupon payments and a final principal payment whose real purchasing power is preserved across the life of the bond.
Total return is the combined result of income and capital appreciation on an investment over a specified period, expressed as a single figure that captures every source of return the investment produced.
Value at risk is a summary risk measure that states the loss a portfolio would not exceed over a specified time horizon at a specified confidence level, typically expressed as a dollar amount or a percentage of portfolio value.
Variance is a measure of how much the individual values in a data set differ from their average, computed as the average of the squared deviations from the mean and expressed in squared units of the data.
