Diversification is a risk management technique that mixes a wide variety of investments within a portfolio. The theory is that the portfolio will have less risk...
Bonds are a form of debt. Essentially they are like an IOU where the investor loans money to a company, the government or another organisation. The...
An annuity is a financial contract, which provides an income stream in return for an initial payment with specific parameters. There are different types of annuities...
Venture capital is financial capital provided to early-stage firms, such companies are usually high potential high-risk. Investors perceive long-term growth for their investment with an exit...
A public offering involves the offering of securities of a company or similar corporation to the public. Generally, the securities are to be listed on a...
The effective yield is a calculation for bonds that assumes you reinvest the coupon once you have received payments. Effective yield takes into account the power...
The Enterprise Investment Scheme (EIS) offers tax relief to investors buying shares in smaller high-risk trading companies. It is designed to encourage investment n companies that...
In finance the beta of an investment is a measure of the risk arising from exposure to general market movements. It can be used to measure...
The interest rate risk is the risk than an investment’s value will change due to a change in interest rates. Interest rate risk affects the value...
Portfolio turnover measures how frequently fund managers buy and sell assets within a portfolio. The measurement is usually reported over a twelve-month period. A low turnover...
Asset allocation is the act of deciding which categories of assets the investable amount should be invested in and what proportion should be in each category....
The absolute return measures the gain or loss of a portfolio as a percentage of invested capital. It looks at the appreciation or depreciation that an...
A mutual fund is an open-ended investment fund that combines money from shareholders and invests it in diverse securities, including stocks and bonds. The funds are...
An asset class is a group of investments that have similar characteristics and are subject to similar laws and regulations. The three main asset classes are...
Calculating the earnings per share (EPS) gives a measurement of the amount of a company’s profit that can be allocated to one share of its stock....