Starting out

• AssetAnything you own that has value and could, in principle, be sold or produce income.
• Asset classA group of investments that behave alike and are driven by the same broad forces.
• BondA loan you make to a government or company, which pays you interest and returns your money on a set date.
• BrokerThe firm that holds your account and sends your orders to the market on your behalf.
• CUSIPA nine-character code identifying a security issued in the United States or Canada.
• Capital gainThe profit made when you sell something for more than you paid for it.
• CompoundingEarning returns on the returns you already earned, so growth accelerates the longer you leave it alone.
• Cost basisWhat you actually paid for a holding, including fees — the number every gain or loss is measured from.
• DiversificationSpreading money across things that do not move together, so no single failure can decide your outcome.
• DividendA cash payment a company makes to its shareholders out of its profits.
• EquityA share of ownership in a company, giving you a claim on what is left after everyone else is paid.
• ExchangeA regulated marketplace where buyers and sellers of securities are matched under published rules.
• Free floatThe portion of a company’s shares that is actually available to trade in the market.
• ISINA twelve-character global code that identifies one security uniquely, anywhere in the world.
• InflationThe rate at which prices rise, which means the rate at which each pound or dollar buys less.
• Limited liabilityThe rule that a shareholder can lose what they invested and no more, whatever the company owes.
• LiquidityHow quickly you can turn something into cash at a fair price, without moving the price against yourself.
• ListingA company’s admission to trade its shares on a particular exchange, under that exchange’s rules.
• Market capitalisationWhat the market says a whole company is worth: the share price multiplied by the number of shares.
• PortfolioEverything you own, considered as one thing rather than as a list of separate holdings.
• PositionEverything you currently hold in one investment, however many separate purchases built it up.
• Purchasing powerWhat your money can actually buy, rather than how many units of currency you have.
• ReturnWhat an investment gained or lost over a period, as a percentage of what it was worth at the start.
• ShareOne unit of ownership in a company — the smallest slice of its equity you can hold.
• ShareholderSomeone who owns shares in a company, and with them a vote and a claim on its profits.
• Shares outstandingThe total number of a company’s shares currently held by all its investors.
• Small-cap, mid-cap and large-capRough size bands used to group companies by market capitalisation.
• Tax lotOne purchase of a security, tracked separately with its own date and price.
• TickerThe short code that identifies a security on a particular exchange.
• Time horizonHow long until you need the money — the single fact that should shape most of your other decisions.
• WeightHow much of your portfolio one holding represents, as a percentage of the total value.

Educational reference only. Nothing here is investment advice or a recommendation to buy or sell anything, and tax treatment depends on your own circumstances and the country you are in.