A fuller guide to this term is on the way. In the meantime, the related terms below explain the ideas around it.
Related MoneyPedia terms
- DiversificationSpreading your money across many different investments so a drop in any single one does less damage.
- Asset AllocationHow you split your money among stocks, bonds, and cash — the biggest driver of risk and growth.
- Standard DeviationA statistic showing how widely an investment's returns swing around their average, used to gauge risk.
- BetaA measure of how much an investment tends to move compared with the overall market.
- Asset ClassA group of investments that behave similarly, such as stocks, bonds, cash, or real estate.
- PortfolioThe full collection of investments you own, such as stocks, bonds, and funds held across your accounts.
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Plain-English education — not personalized legal, tax, or investment advice.