Glossary

Term Definition
Asset Anything having commercial or exchange value that is owned by a business, institution or individual.
Bottom-up selection Selecting stocks based on the attractiveness of a company.
Capital Refers to the financial assets, or resources, that a company has to fund its business operations.
Developed economy/market Well-established economies with a high degree of industrialisation, standard of living and security.
Diversification/Diversified The practice of investing in a variety of assets. This is a risk management technique where, in a well-diversified portfolio, any loss from an individual holding should be offset by gains in other holdings, thereby lessening the impact on the overall portfolio.
Emerging economy or market
Economies in the process of rapid growth and increasing industrialisation. Investments in emerging markets are generally considered to be riskier than those in developed markets.
Equity/Equities Shares of ownership in a company.
Underweight If a portfolio is ‘underweight’ a stock, it holds a smaller proportion of that stock than the comparable index or sector.
Valuation metrics Measures used for determining the current worth of an asset or company.