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
- DividendA portion of a company's profits paid out to shareholders, usually as cash on a regular schedule.
- DiversificationSpreading your money across many different investments so a drop in any single one does less damage.
- YieldThe income an investment pays you each year, shown as a percentage of its current price.
- Asset AllocationHow you split your money among stocks, bonds, and cash — the biggest driver of risk and growth.
- EquityOwnership in a company, most often held as shares of stock that represent a claim on its assets and profits.
- StockA share of ownership in a company that you can buy and sell, giving you a small stake in its profits and growth.
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Plain-English education — not personalized legal, tax, or investment advice.