Glossary

Term Definition
Diversified/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.
Developed economy/market Well-established economies with a high degree of industrialisation, standard of living and security.
Emerging economies 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.
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.