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.
- Risk ToleranceHow much investment ups and downs you can handle emotionally and financially without changing your plan.
- Emergency FundCash set aside for life's surprises, so a bad week doesn't turn into debt.
- Asset AllocationHow you split your money among stocks, bonds, and cash — the biggest driver of risk and growth.
- Financial PlanA written roadmap that maps your income, spending, saving, and investing to reach specific money goals over time.
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Plain-English education — not personalized legal, tax, or investment advice.