Glossary
Key terms and definitions used throughout the CMA Investment Management Regulations Course.
Authorised Person
An entity licensed by the CMA to carry out one or more securities business activities
Beneficial Owner
The person who holds the economic rights to securities, even if legal title is held by a nominee
Capital Market Institution (CMI)
An entity holding a licence from the CMA to conduct securities business
Capital Market Law (CML)
The foundational legislation (Royal Decree No. M/30) establishing the CMA and regulating the Saudi capital market
Custodian
A licensed entity responsible for safekeeping securities and other assets on behalf of clients
Discretionary Portfolio Management (DPM)
An investment management service where the manager has authority to make investment decisions without prior client approval
DPMA
Discretionary Portfolio Management Agreement — the contract governing the DPM relationship
Edaa
The Securities Depository Center, responsible for the registration, clearing, and settlement of securities in Saudi Arabia
Fiduciary Duty
The highest standard of care requiring a person to act solely in the best interests of another
Investment Fund
A collective investment scheme pooling capital from multiple investors for investment in securities or other assets
Investment Funds Regulations (IFR)
CMA regulations governing the establishment, offering, and management of investment funds
KYC/AML
Know Your Client / Anti-Money Laundering — procedures for verifying client identity and detecting suspicious activities
Managing Investments Licence (M1)
CMA licence authorising the management of investment portfolios and private funds
Managing Investments and Operating Funds Licence (M2)
CMA licence authorising all M1 activities plus REIT management, foreign fund distribution, and fund administration
MISA
Ministry of Investment Saudi Arabia — the government body responsible for licensing foreign investment
NAV
Net Asset Value — the total value of a fund's assets minus its liabilities, divided by outstanding units
Nominee
A person or entity that holds legal title to securities on behalf of the beneficial owner
Nomu
The Parallel Market of the Saudi Exchange, designed for smaller companies with lighter listing requirements
OSCOs
Rules on the Offer of Securities and Continuing Obligations — CMA regulations governing securities offerings
Prospectus
A comprehensive disclosure document required for public offerings of securities
REIT
Real Estate Investment Trust — a fund investing primarily in income-generating real estate
Registered Person
An individual registered with the CMA to perform regulated functions at a CMI
Segregation of Assets
The requirement to keep client assets separate from the firm's own assets
Suitability Assessment
The process of evaluating whether an investment strategy is appropriate for a client's circumstances
Sukuk
Sharia-compliant financial instruments representing ownership in underlying assets
Tadawul
The Saudi Exchange — the main stock exchange in Saudi Arabia
Terms and Conditions (T&Cs)
The constitutional document of an investment fund
Vision 2030
Saudi Arabia's strategic framework for economic diversification and development
Zakat
Islamic wealth tax levied at 2.5% of the zakat base, applicable to Saudi and GCC nationals