{"id":133,"date":"2023-01-24T09:30:00","date_gmt":"2023-01-24T09:30:00","guid":{"rendered":"http:\/\/www.wealthatwork.co.uk\/btnew\/?page_id=133"},"modified":"2023-01-24T09:30:00","modified_gmt":"2023-01-24T09:30:00","slug":"glossary","status":"publish","type":"page","link":"https:\/\/www2.wealthatwork.co.uk\/bt\/glossary\/","title":{"rendered":"Glossary"},"content":{"rendered":"

Asset –\u00a0<\/strong>Possession that has intrinsic value.
\nAsset class –\u00a0<\/strong>A distinct category of investment such as bonds, equities or cash.
\nAsset allocation<\/strong> – The practice of distributing an investment across different types of investment to meet investor requirements or respond to market conditions.
\nBond –\u00a0<\/strong>A security issued by a company or government that usually pays a fixed income and promises to return the original capital paid for it on maturity.
\nCapital –\u00a0<\/strong>Money used for investment.
\nCapital Gains Tax –\u00a0<\/strong>A tax paid on the sale of chargeable asset.
\nCash –\u00a0<\/strong>The collective term for uninvested capital and money held on deposit.
\nCompounding –\u00a0<\/strong>The practice of continually reinvesting investment income to create a larger pool of capital.
\nCorporate Bond –\u00a0<\/strong>A bond issued by a company (as opposed to a government bond such as \u2018gilt\u2019).
\nCoupon –\u00a0<\/strong>The income paid on a bond expressed as a percentage of its issue value.
\nCredit rating –\u00a0<\/strong>An assessment of a bond issuer\u2019s financial strength, indicating its ability to meet the payments promised on its bonds.
\nDefault –\u00a0<\/strong>A situation where a company or government is unable to meet the income or capital payments on its bonds.
\nDividend –\u00a0<\/strong>The slice of profits that a company pays out to its shareholders.
\nEmerging market –\u00a0<\/strong>A developing economy, often in the early stages of applying free market principles. Can be volatile but can experience high growth rates.
\nEmployee share scheme –\u00a0<\/strong>A scheme by which an employee acquires shares in their employer.
\nEquity –\u00a0<\/strong>Another name for an ordinary company share; the collective term for investment in shares.
\nEstate –\u00a0<\/strong>The total value of all assets and possessions.
\nExchange Traded Fund (ETF) –\u00a0<\/strong>A tradeable share that tracks the value of a market index or sector.
\nFixed income\/Fixed interest –\u00a0<\/strong>An alternative term for bonds.
\nFTSE 100 –\u00a0<\/strong>A stockmarket index that follows the overall value of the largest 100 companies traded on the UK stock market.
\nGilt –\u00a0<\/strong>A bond issued by the British government.
\nGross –\u00a0<\/strong>Income before any deductions including tax.
\nHigh-yield bond –\u00a0<\/strong>Bonds with a sub-investment grade credit rating that have to pay a higher yield to compensate for the higher risk they involve.
\nIncome tax –\u00a0<\/strong>Tax payable on all forms of income, including salary, bank account interest, bond income and share dividends.
\nIndex –\u00a0<\/strong>A measure that follows the rises and falls in value in a stock market.
\nIndex-linked –\u00a0<\/strong>Any investment whose return is linked to inflation in order to keep its purchasing power.
\nIndividual Savings Account (ISA) –\u00a0<\/strong>A tax free wrapper for investments with the option of a stocks and shares and\/or cash account.
\nInflation –\u00a0<\/strong>The tendency of the price of goods and services to rise over time, reducing the purchasing power of your money.
\nInheritance tax –\u00a0<\/strong>A tax paid on certain lifetime transfers and the value of an estate on death.
\nInterest –\u00a0<\/strong>The return earned on a cash deposit or bond.
\nISA –\u00a0<\/strong>See Individual Savings Account.
\nLaddering –\u00a0<\/strong>The practice of investing across different maturities of bond to create a regular stream of maturing capital and\/or take advantage of different rates of interest.
\nLiquidity –\u00a0<\/strong>Refers to how easily an investment can be bought and sold; general term for cashbased investments.
\nLiquidity fund –\u00a0<\/strong>A fund that invests across a wide range of different cash investments in order to diversify risk and achieve an attractive yield.
\nMoney market fund –\u00a0<\/strong>Another name for a liquidity fund.
\nNet –\u00a0<\/strong>Income after any deductions including tax.
\nOEIC (Open Ended Investment Company) –\u00a0<\/strong>An investment fund that is very similar to a unit trust but with a more flexible structure.
\nPotentially Exempt Transfer –\u00a0<\/strong>A lifetime transfer of value that will only be subject to tax if you die within seven years of making the transfer.
\nReal returns –\u00a0<\/strong>The investment return you make after the effect of inflation has been taken into account.
\nRisk –\u00a0<\/strong>The likelihood that an investment can fall in value.
\nSave As You Earn (SAYE) –\u00a0<\/strong>An all employee share scheme that enables employees to save regular amounts with the intention of buying shares in their employer.
\nShare –\u00a0<\/strong>A security issued by a company that gives the holder the right to vote on company issues and receive a slice of the company\u2019s profits in the form of a dividend.
\nSelf Invested Personal Pension –\u00a0<\/strong>A flexible personal pension scheme managed on behalf of an individual that can hold a very wide range of investments.
\nUnit trust –\u00a0<\/strong>A pooled investment fund managed by a professional fund manager. So-called because the fund is divided into units of equal size whose value tracks the performance of the underlying portfolio.
\nVolatility –\u00a0<\/strong>The tendency for an investment\u2019s value to fluctuate.
\nYield –\u00a0<\/strong>The income being earned on an investment expressed as a percentage of its current value.<\/p>\n ","protected":false},"excerpt":{"rendered":"

Asset –\u00a0Possession that has intrinsic value. Asset class –\u00a0A distinct category of investment such as bonds, equities or cash. Asset allocation – The practice of distributing […]<\/p>\n","protected":false},"author":1,"featured_media":0,"parent":0,"menu_order":0,"comment_status":"closed","ping_status":"closed","template":"full-width-page.php","meta":{"footnotes":""},"_links":{"self":[{"href":"https:\/\/www2.wealthatwork.co.uk\/bt\/wp-json\/wp\/v2\/pages\/133"}],"collection":[{"href":"https:\/\/www2.wealthatwork.co.uk\/bt\/wp-json\/wp\/v2\/pages"}],"about":[{"href":"https:\/\/www2.wealthatwork.co.uk\/bt\/wp-json\/wp\/v2\/types\/page"}],"author":[{"embeddable":true,"href":"https:\/\/www2.wealthatwork.co.uk\/bt\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www2.wealthatwork.co.uk\/bt\/wp-json\/wp\/v2\/comments?post=133"}],"version-history":[{"count":1,"href":"https:\/\/www2.wealthatwork.co.uk\/bt\/wp-json\/wp\/v2\/pages\/133\/revisions"}],"predecessor-version":[{"id":134,"href":"https:\/\/www2.wealthatwork.co.uk\/bt\/wp-json\/wp\/v2\/pages\/133\/revisions\/134"}],"wp:attachment":[{"href":"https:\/\/www2.wealthatwork.co.uk\/bt\/wp-json\/wp\/v2\/media?parent=133"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}