Term Definition
Asset Anything having commercial or exchange value that is owned by a business, institution or individual.
Bond A loan in the form of a security, usually issued by a government or company, which normally pays a fixed rate of interest over a given time period, at the end of which the initial amount borrowed is repaid.
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.
Equities Shares of ownership in a company.
Interest rate risk The risk that a fixed income investment will lose value if interest rates rise.
Macroeconomic Refers to the performance and behaviour of an economy at the regional or national level. Macroeconomic factors such as economic output, unemployment, inflation and investment are key indicators of economic performance. Sometimes abbreviated to 'macro'.
Price-earnings ratio A measure that compares a company's current share price to its earnings per share. It provides a guide to the market's opinion about the company's future earnings prospects. Calculated by dividing the market value per share by the earnings per share.
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.
Valuation metrics Measures used for determining the current worth of an asset or company.
Volatility The degree to which a given security, fund, or index rapidly changes. It is calculated as the degree of deviation from the norm for that type of investment over a given time period. The higher the volatility, the riskier the security tends to be.
Yield (bonds) This refers to the interest received from a fixed income security and is usually expressed annually as a percentage based on the investment’s cost, its current market value or its face value.