for financial advisers only

Hang Seng Index

The principal Hong Kong Share Price Index.

Headline inflation

The published overall inflation rate, unadjusted for non-economic factors, as opposed to underlying inflation.

Hedge fund

A type of investment portfolio under which the fund manager is authorised to utilise a number of higher risk investment techniques, including using derivatives, short selling and borrowing funds to generate a higher return.

Hedge/hedging

The practice of undertaking one investment activity in order to protect against loss in another eg selling short to nullify a previous purchase. While hedges reduce potential losses, they also tend to reduce potential profits.

High conviction stocks

Investments that a fund manager has high confidence will do well in the future.

High yield corporate bonds

Generally, a high yield bond will be ranked very low by a rating agency, because these are bonds which have a relatively high chance of default, and therefore risk, so have to offer higher returns.

Higher rate tax

For the 2012/2013 tax year the higher rate of tax is 40%.

Holding company

A company which controls another company, usually by owning 50% or more of its shares.

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