Profit Rate Reserve
The amount set aside from the total mudarabah profits to maintain a certain level of return on investment for the mudarib and unrestricted investment account holders.
Valuation Reserve
It is a reserve or provision created by charging a specific expense account; therefore, it is deducted from profits to hedge against changes that occur in the value of the company’s assets.
Gross Profit Margin
Gross profit margin is calculated by dividing the total sales value, after deducting the cost of sales, by the total sales value, and is expressed as a percentage. For example, if a company’s sales are SAR 100,000 and its cost of sales is SAR 75,000, its gross profit margin is 25% (calculated as (100,000 – […]
Total value of the Fund’s assets
For the purposes of the Investment Funds Regulations and the Real Estate Investment Funds Regulations, this refers to the value of the Fund’s assets, which is valued in accordance with the method for valuing the assets set out in the Fund’s terms and conditions.
Gross Domestic Product
Gross Domestic Product (GDP) is the total monetary value of all goods and services produced within a domestic economy during a specific period. It comprises private consumption, private investment, government expenditures, and net exports.
Total Return
The annual return on an investment, which includes its value appreciation and stock dividends or interest. For bonds held until maturity, the total return is the yield to maturity. For stocks, the increase in their value is estimated using the Price/Earnings (P/E) ratio. In options trading, total return means stock dividends plus capital gains, in […]
Fund management fees
Compensation, expenses, and fees related to advisory services paid to the fund manager.
Record date
The day on which a shareholder must own a company’s shares to be eligible to receive dividend distributions.
Liquidate
To dissolve a company, sell its assets, and settle its liabilities, allocating the proceeds from assets to pay off outstanding debts and obligations. This involves converting assets or holdings into cash, such as through the sale of stocks, bonds, and other investments.
Freeze
A procedure intended to convert a portion of capital from a liquid or circulating state to an immobile or non-immediately usable state, by allocating it to long-term assets or fixed investments. Freezing typically occurs when working capital (such as cash or current accounts) is replaced with fixed capital (such as real estate or equipment), thereby […]