Glossary of Terms

The information presented here is not intended as financial, investment, tax or legal advice and is provided for educational purposes only.
U
Term
Explanation
U.S. Government Securities
Debt securities issued by the U.S. Government and its agencies.
Umbrella Fund
  See Fund of Funds.
Underwriter
(1) An investment banker who purchases securities for his own account with the express intention of reselling them in the open market. (2) An insurer who undertakes to furnish an insurance contract in exchange for a premium. (3) The organization that sells a mutual fund's shares to broker/dealers.
Undistributed Net Investment Income (UNII)
Represents the life-to-date balance of a fund's net investment income less distributions of net investment income. UNII appears as a line item on a fund's statement of changes in net assets.
Uniform Gift to Minors Act (UGMA)
An irrevocable gift to minors enabling them to own securities in a beneficial fashion without need of trust instruments or other legal documents.
Uniform Transfer to Minors Act (UTMA)
Similar to a UGMA, but also allows minors to own other types of property, such as real estate, fine art, patents and royalties, and for the transfers to occur through inheritance.
Unit Investment Trust (UIT)
A registered investment company that purchases a fixed portfolio of securities. The portfolio may consist of corporate, municipal or government bonds — or common or preferred stocks. Bond trusts are designed to provide current (usually monthly) income and capital preservation; as individual bonds mature, proceeds are distributed to unit holders. Stock trusts are intended to provide capital appreciation and dividend income; on the stock trust's expiration date, the trust liquidates and distributes its net asset value as proceeds to the unit holders. Units of a trust are sold to investors through brokers.
Unit Investment Trust (UIT)
A portfolio of securities that remains fixed, except under certain circumstances, for the life of the trust. Shares of this portfolio are offered to individual investors and called "units." Also called Defined Portfolio. Other UITs serve as the structure for some early exchange-traded funds (ETFs).