Risking money on activities where the outcome is largely based on chance or luck. The risk in gambling is usually high. It is very different from investing, which aims for long-term growth based on company performance that can be predicted to a greater degree of accuracy than is found in gambling. 

A valuable metal often used by investors as a safe store of value and a hedge against inflation. Retail investors can purchase gold as a physical item (like bars or coins), gold ETFs, mining stocks, or ‘digital gold’. Gold helps to diversify portfolios during economic uncertainty, but can also be subject to bubbles and speculation. 

Known as the father of value investing, Benjamin Graham developed a strategy focused on buying stocks that are undervalued compared to their true worth. He taught investors to look for companies trading below their intrinsic value, providing a margin of safety, and to invest patiently for long-term gains. He was an influential figure on successful investors like Warren Buffett.

An investment or investment tactic that aims to reduce the risk of losing money in another investment. It works like insurance by balancing potential losses with gains from another asset, helping to protect your portfolio from big drops in value.

The tendency of investors to prefer investing money in companies from their own country rather than diversifying internationally. This happens because investors feel more familiar with their home market but it can limit potential benefits from global diversification. 

An index measures the performance of a specific group of stocks or other investments, showing how that market is doing overall. They are the basis for index funds which aims to copy the performance of a particular index, known as the benchmark, by holding the same assets within it.

When the overall prices of goods and services rise overtime. The result of inflation is that your money buys less as time goes on. It reduces the purchasing power of money, meaning things gradually become more expensive for consumers.

When a private company sells shares to the public for the first time, becoming publicly traded on a stock exchange. It allows the company to begin raising money from investors and provides an opportunity for early investors (pre-public) to sell their shares. 

Buying or selling a company’s shares based on important information that is not available to the public. It is illegal because it gives unfair advantage to those with secret knowledge, undermining trust in financial markets.

The cost that is paid for borrowing money or the income earned from lending money. It is usually expressed as a percentage of the amount borrowed or deposited (the principal). When you take a loan, you pay interest on the amount borrowed, and when you save in a bank account you earn interest on your deposit since you are lending it to the bank who is borrowing it. 

The act of putting your money into assets like stocks, bonds, or funds. The aim is to see that money grow with time in order to increase wealth. 

A collection of money pooled from many investors to buy assets like stocks or bonds. It is managed by professionals who charge fees for providing investors with diversification and expert management on the investors’ behalf.

A person or organisation that puts money into stocks, bonds, or other assets with the goal of making a profit by taking on some risk that they should see returns from the money they invest. 

A UK savings or investment account that lets you grow your money tax-free. You do not pay tax on the interest, dividends, or capital gains earned within the ISA, making it a popular way for retail investors to save or invest efficiently up to an annual limit of £20,000.

A seasonal phenomena where stock prices, especially small-caps, tend to rise more in January more than in other months. This is often attributed to investors in the US buying back stocks after selling them for tax reasons in December or using year-end bonuses to invest at the start of the year.

An investment philosophy that focuses on simple, proven strategies that consistently deliver OK results rather than chasing complex or trendy approaches. It encourages retail investors to stick with methods like diversification, dollar-cost-averaging, and long-term holding that have been shown to be more effective over time.

Shares in a company with a large market value, more than around $10 billion. These are the most well established companies and industry leaders known for stable, steady, growth, and often pay regular dividends. Large caps are popular for conservative investors. 

Using borrowed money to increase the size of an investment, aiming to boost potential returns. While leverage can amplify gains, it also increases the risk of much bigger losses if the investment doesn’t perform well. 

Money or debts a person or company owes to another. It must be paid back or settled in the future, and includes loans, bills, mortgages, etc.

A listed company is one whose shares are officially registered and traded on public stock exchanges like the LSE or the NYSE. Being listed allows the public, especially retail investors, to buy and sell a company’s shares easily and ensures a degree of transparency through regular financial reporting. 

The process of selling assets to pay off debts and transform what is left into cash. It takes place usually when a company is closing down or in bankruptcy. For investors it means the company is winding up and money will be distributed to creditors/bondholders/shareholders based on priority. 

How easily and quickly you can buy or sell an asset without causing its price to change much. High liquidity means you can trade easily at a fair price, while low liquidity means it is harder to sell quickly without lowering the price. 

Holding investments for several years or even decades to allow them time to grow and smooth out markets ups and downs. It is about patience and focusing on steady wealth building rather than quick profits. 

Places or systems where buyers and sellers come together to trade assets. They can be physical locations or electronic platforms, helping investors buy and sell investments easily. 

Market capitalisation is the total current value of all a company’s shares calculated by multiplying share price by the number of shares available. 

The difference between a stock’s estimated true (intrinsic) value and the price you pay for it. Buying at a significant discount provides a cushion to protect investors against errors in valuation or market downturns, reducing the risk of loss.

The percentage of revenue a company keeps as profit after paying all its costs. It shows how much money the business earns from each dollar of sales, helping investors understand how efficiently the company manages expenses and makes money.

When two companies combine to form one new company, usually to grow, reduce costs, or enter new markets. It’s usually voluntary where companies join forces on roughly equal terms to benefit their shareholders.

Shares of companies with a medium-sized market value, generally between $2 billion and $10 billion. They are considered to balance growth potential with stability, sitting between small-caps and large-caps in terms of size and risk. 

A tool to buy goods and services, and to measure value. It acts as a medium of exchange and a unit of account, making trade and saving easier for individuals and investors. 

A company that provides ratings and research on investment funds and stocks. It is a popular platform that helps investors quickly gauge quality and understand decisions.

Was a highly respected American investor, businessman, and chairman of Berkshire Hathaway alongside Warren Buffett. His disciplined investment philosophy helped shape modern value investing with a focus on buying great businesses at fair prices.

A pool of money collected from many investors to buy a variety of investments like stocks, bonds, or other assets. It is managed by professionals who decide what to buy and sell, aiming to grow the overall investments and share the profits with the investors for a fee. 

A major American electronic stock exchange based in New York. It is the first fully automated stock market and lists many technology companies. 

The value of everything you own (assets) minus what you owe (liabilities). It provides a snapshot of financial health after debts are paid. 

New York Stock Exchange: a major stock exchange located in New York. It is the world’s largest marketplace for buying and selling company shares (stocks) and has been operating since 1792.

Contracts that given investors the right but not the obligation to buy something at a specific price before a certain date. Call options are bought when the price is expected to rise, and put options are bought when the price is expected to fall. They are a form of hedge, allowing investors to transact with less capital than buying the stock outright. 

When a stock’s price is higher than what its actual worth or financial performance justifies. It’s largely subjective, but can increase the risk a stock’s price will fall when the market corrects itself.

Individuals or entities holding shares or stock in a company. They have a partial claim on the company’s assets and profits, can benefit from dividends, and share price increases.

A measure of the cash a company generates that is available to its owners after paying for necessary expenses to maintain the business. It reflects the true cash profit that can be used for dividends, reinvestments, or debt repayments and is considered a clearer indicator of financial health than net income.

A regular payment made to people once they retire from work to provide financial support. It is usually funded by contributions made while working by the employee, employer, or both, and is one part of ensuring a steady income after stopping work. 

The value or amount calculated for each individual share of a company’s stock. It can be applied to earnings, dividends, or price, by breaking them down to the individual share level to make comparisons easier.

A collection of all the investments you own, including stocks, cash, bonds, gold, other assts. Having a portfolio helps you diversify your investments to balance risk and return and should be constructed according to your individual financial goals and risk tolerance. 

The current amount of money you need to pay to buy one unit of something. Price changes based on the demand and supply of the something, and is influenced by performance, news and trends. 

A measure that compares the company’s current share price to its earnings per share. It shows how much investors are willing to pay for each dollar of the company’s profit, helping to asses if a stock is over or undervalued.

A measure that compares the company’s current stock price to its book value per share. It shows how much investors are willing to pay for each dollar of the company’s net assets, helping indicate if a stock is over or undervalued. 

Revenue minus costs.