Glossary - T

The time value of money means that a sum of money is worth more now than the same sum of money in the future.The principle of the time value of money recognizes that money can grow in value by investing it, and a delayed investment is a lost opportunity.

Total return is the actual rate of return of an investment or a pool of investments over a period. Total return includes interest, capital gains, dividends, and realized distributions.

“Tracking Error” is defined as the standard deviation of the difference in daily returns between the Scheme and the Underlying Index annualized over 1 year period. Thus, Tracking Error is the extent to which the NAV of the Scheme moves in a manner inconsistent with the movements of the Underlying Index on any given day or over any given period of time due to any cause or reason whatsoever including but not limited to expenditure incurred by the Scheme, Dividend payouts if any, whole cash not invested at all times as the Scheme may keep a portion of funds in cash to meet redemption etc.

Legal custodian who looks after all the monies invested in a unit trust or mutual fund.