Glossary

Term Definition
Capital Refers to the financial assets, or resources, that a company has to fund its business operations.
Diversification 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.
Dividend  Dividends represent a share in the profits of the company and are paid out to a company’s shareholders at set times of the year.
Liquidity A company is considered highly liquid if it has plenty of cash at its disposal. A company's shares are considered highly liquid if they can be easily bought or sold since large amounts are regularly traded.
Risk  The chance that an investment's return will be different to what is expected. Risk includes the possibility of losing some or all of the original investment.
Yield Refers to the dividends received by a holder of company shares and is usually expressed annually as a percentage based on the investment's cost, its current market value or face value. Dividends represent a share in the profits of the company and are paid out to a company’s shareholders at set times of the year.