Investments Glossary
Here is our glossary of investment jargon:
- Asset Allocation
- The spread of investments across the asset classes.
- Asset Classes
- The underlying investments - shares, bonds, property and cash deposits.
- Bonds
- A loan to a company or the government.
- Capital
- The money you invest
- Capital Growth
- An increase in the value of your investment after costs and charges.
- Collective investments
- A way of pooling contributions from lots of people into a single investment fund.
- Distribution
- A type of investment bond or fund that provides a regular income.
- Diversification
- Spreading your investments across different asset classes, or types of investments within an asset class.
- Dividends
- Payments made by a company to its shareholders out of any profit it makes.
- Equities
- Another name for shares in a company.
- Gilts
- Bonds issued by the UK government.
- Income
- Money paid from an investment, by dividend and interest.
- Investment/Insurance bonds
- A pooled investment; a lump sum life assurance investment.
- ISA
- Individual Savings Account - a tax wrapper for savings and investments.
- OEIC
- Open-Ended Investment Company - also known as an ICVC. A type of open-ended investment fund.
- PEP
- Personal Equity Plan - a wrapper for investments but no longer available to buy - similar to ISAs.
- Rate of return
- The change in the value of your investment taking into account both income and growth.
- Stocks/Shares
- A stake or share in a company.
- Unit trusts
- A pooled investment, this is an open-ended investment that gets bigger as more people invest in it and smaller when they take money out.
