Vocabulary

• Real Estate – This refers to property consisting of land or buildings, including residential and commercial properties. These can be purchased for personal use or as an investment.
• Stock Market – A public marketplace for buying and selling company shares. This is often used as a platform for investment.
• Investment – The allocation of resources, usually money, with the expectation of generating an income or profit.
• Portfolio – A collection of investments held by an individual or an institution.
• Equity – This refers to the ownership interest in a company, represented by shares of stock.
• Dividend – A portion of a company's earnings distributed to its shareholders.
• Capital Gain – The increase in value of an investment or a real estate property over time.
• Liquidity – The ease with which an asset or investment can be converted into cash without affecting its market price.
• Risk Tolerance – An investor's ability or willingness to endure declines in the prices of investments.
• Asset – A resource with economic value that an individual, corporation, or country owns or controls with the expectation that it will provide future benefit.
• Bonds – A fixed income investment where an investor loans money to a corporate or government entity, which borrows the funds for a defined period at a fixed interest rate.
• Mortgage – A loan used to purchase real estate.
• Rental Income – The income received from leasing a property.
• Appreciation – The increase in the value of an asset over time.
• Diversification – The strategy of investing in a variety of assets to reduce exposure to risk.
• Return on Investment (ROI) – A measure used to evaluate the efficiency or profitability of an investment.
• Market Value – The price at which an asset would trade in a competitive auction setting.
• Volatility – The rate at which the price of an asset increases or decreases for a set of returns.
• Bull Market – A financial market of a group of securities in which prices are rising or are expected to rise.
• Bear Market – A condition in which securities prices fall and widespread pessimism causes the stock market's downward spiral to be self-sustaining.
• Broker – A person who buys and sells goods or assets for others.
• Tenant – A person who occupies land or property rented from a landlord.
• Landlord – The owner of property that is leased or rented to another.
• Interest Rate – The amount charged, expressed as a percentage of the principal, by a lender to a borrower for the use of assets.
• Financial Advisor – A professional who provides financial services to clients based on their financial situation.
• Taxation – The means by which governments finance their expenditure by imposing charges on citizens and corporate entities.
• Leverage – The use of various financial instruments or borrowed capital to increase the potential return of an investment.
• Capital – Wealth in the form of money or other assets owned by a person or organization or available for a purpose such as starting a company or investing.
• Credit – The ability of a customer to obtain goods or services before payment, based on the trust that payment will be made in the future.
• Debt – An amount of money borrowed by one party from another.
• Inflation – The rate at which the general level of prices for goods and services is rising, and subsequently, purchasing power is falling.
• Deflation – The reduction of the general level of prices in an economy.
• Recession – A period of temporary economic decline during which trade and industrial activity are reduced.
• Market Crash – A sudden dramatic decline of stock prices across a significant cross-section of a stock market.
• Mutual Funds – An investment program funded by shareholders that trades in diversified holdings and is professionally managed.
• Index Funds – A type of mutual fund with a portfolio constructed to match or track the components of a market index, such as the Standard & Poor's 500 Index (S&P 500).
• ETFs (Exchange Traded Funds) – A type of investment fund and exchange-traded product, traded on stock exchanges.
• REITs (Real Estate Investment Trusts) – A company that owns, operates, or finances income-generating real estate.
• Passive Income – Income resulting from cash flow received on a regular basis, requiring minimal to no effort by the recipient to maintain it.
• Active Income – Income for which services have been performed.
• Capital Market – A market in which individuals and institutions trade financial securities.
• Physical Asset – An item of economic, commercial, or exchange value that has a tangible or material existence.
• Market Cycle – The period between the two latest highs or lows of the S&P 500, showing net performance of a fund through both an up and a down market.
• Blue-Chip Stocks – Shares in large, well-established companies known for their ability to generate profits.
• Growth Stocks – Shares in a company whose earnings are expected to grow at an above-average rate relative to other stocks.
• Value Stocks – Shares of a company with solid fundamentals that are priced below those of its peers, based on analysis of price to earnings ratio, yield, etc.
• IPO (Initial Public Offering) – The process by which a private company can go public by sale of its stocks to general public.
• Short Selling – The sale of a security that is not owned by the seller, or that the seller has borrowed, in the hope that the price will go down.
• Yield – The income return on an investment, such as the interest or dividends received.
• Securities – A fungible, negotiable financial instrument that holds some type of monetary value. It represents an ownership position in a publicly-traded corporation (via stock), a creditor relationship with a governmental body or a corporation (represented by owning that entity's bond), or rights to ownership as represented by an option.