Here's a simplified and clearer version:

Use the Alphabet to Find Terms Quickly: 

A - Z 

A 

• Accumulation shares/units: Income from shares or funds is reinvested instead of paid out as cash. 

• Active investment/management: Fund managers actively manage investments to outperform a benchmark or index. 

• Adventurous (portfolio): Higher risk for potential long-term returns, such as emerging markets. 

• AIM (Alternative Investment Market): A sub-market of the London Stock Exchange with fewer regulations. 

• Ask price: Minimum price a seller accepts for their shares. 

• Asset allocation: Distribution of funds across various asset types (e.g., shares, bonds, property). 

B 

• Balanced/cautious funds: Funds with a mix of assets, aiming for moderate returns and protection from downturns. 

• Base interest rate: The rate a central bank charges commercial banks. 

• Bear market: A significant drop (20% or more) in share prices, often linked to economic downturns. 

• Benchmark: A reference index to measure fund performance. 

• Bid price: The highest price a buyer is willing to pay for shares. 

• Bitcoin: A decentralized cryptocurrency. 

• Blue-chip: A stable, reputable company. 

• Bonds: Loans to companies/governments, repaid with interest at maturity. 

• Book value: The value of a company’s assets minus liabilities. 

• Bottom-up investing: Focus on company-specific factors, such as financials and market share. 

• Bull market: A period of rising share prices. 

C 

• Capital gain: Profit from selling an asset at a higher price than it was bought. 

• Capital growth: Increase in the value of invested capital. 

• Commodities: Physical goods like oil, wheat, and metals. 

• Consumer Price Index (CPI): Measures price changes for goods and services. 

D 

• Defensive assets: Investments that offer stable returns, like bonds and cash. 

• Dividend: Cash payments to shareholders. 

• Dividend yield: Dividend per share divided by the share price. 

E 

• Earnings per share (EPS): Company profit divided by its shares. 

• Emerging markets: Developing countries with growing economies. 

• ESG: Environmental, social, and governance-focused investing. 

• Equities: Shares representing company ownership. 

F 

• Fractional shares: Buying less than one full share. 

• FTSE 100: Index of the largest 100 companies on the London Stock Exchange. 

• Fund: Pooled money from multiple investors used for a range of investments. 

G 

• Gilts: UK government bonds with fixed returns. 

• Growth investing: Focus on companies with potential for earnings growth. 

H 

• Hedging: Reducing risk through financial strategies. 

• High net worth individual: Someone with significant liquid assets. 

I 

• Income: Earnings from investments like dividends or interest. 

• Index: Group of shares tracking a specific market or sector. 

• Inflation: Increase in the price of goods and services. 

J 

• Junk bonds: High-risk bonds with higher interest to compensate for the default risk. 

K 

• Key Investor Information Document (KIID): Outlines investment details like objectives and fees. 

L 

• Limit order: Set prices for buying or selling shares automatically. 

• London Stock Exchange (LSE): Primary stock exchange in the UK. 

M 

• Market capitalisation: The value of a company’s shares. 

• Market risk: The risk of loss due to market declines. 

N 

• Nasdaq: A major US stock exchange, home to many tech companies. 

• Negative growth: A decline in value or economic activity. 

O 

• Offer price: The price a seller asks for shares. 

• Ongoing charge: Fund management and operating fees. 

P 

• Platform: Online services for buying and selling investments. 

• Price-earnings (P/E) ratio: Share price divided by earnings per share. 

Q 

• Quantitative easing: Central bank policy to increase money supply and stimulate growth. 

R 

• Recession: Economic downturn, often measured by GDP decline over two quarters. 

• Risk-free rate of return: Theoretical return from a zero-risk asset. 

S 

• Sector: Group of companies in a similar industry (e.g., tech, energy). 

• Stop-loss order: Automatic sale if a share price falls to a set level. 

T 

• Total return: Income from dividends plus changes in capital value. 

Here's a refined version of the terms, keeping them straightforward and concise: 

U 

Unit: A portion of a fund, similar to a share in a company. Each unit represents a portion of the fund’s assets. 

V 

Valuation: A method for estimating a company's current worth, often by comparing its price-earnings ratio with others in its sector. 

Value investing: A strategy that focuses on selecting shares believed to be priced below their intrinsic value, with the expectation of future price increases. 

Value shares: Shares of companies considered to be temporarily underpriced, with the anticipation of future price growth. 

Volatility: A measure of how much an asset’s price fluctuates in the short-term. 

W 

Windfall profits: Unexpected, large profits that occur due to external circumstances, such as the recent rise in wholesale energy prices for oil and gas producers. 

X 

XD (Ex-dividend): Refers to a share that is trading without the value of its upcoming dividend. 

Y 

Yield: The income generated from an investment, typically expressed as a percentage of its value. 

Z 

Zero-coupon bond: A bond that doesn’t pay interest during its life. It is sold at a discount and matures at its full face value. 

Tax treatment depends on individual circumstances and may change. This content is for informational purposes only and does not constitute tax advice.