10 Investment Terms You Should Know

Learning to invest is in a way similar to learning a language; you need to learn new words.

Our aim in this article is to briefly explain the ten possible concepts you will hear in the world of investment. We will try to keep the text as clear and simple as we can.

Exchange Traded Fund (ETF)

ETF is an alternative investment tool that collects certain investments such as stocks and can be bought and sold as the same shares. ETFs have their own sub-investment; When you receive a share of an ETF, you have a share of all the companies that ETF invests in. ETFs are frequently seen to invest in indices representing a particular portion of the stock market.

Stock

The stock is a representative unit showing how much an investor has a company. If you have shares of a company, a certain part of that company is yours. Equities are also called shares.

Bond

When you buy bonds, you lend to a company. Bonds are debt instruments. Although the word ından debt se may seem like a negative obligation, the debt is one of the most important wheels of the economy.

portfolio

The portfolio is called the sum of the shares that you or the funds you invest in and hold. For example, if you only have shares of Apple, Microsoft and Netflix, your portfolio is all about this.

Total Risks

The sum of risks is the sum of the risks you take financially. These risks may be down (in price) or profit potential (increase in price).

Equity

Equity is the feeling you have. You have the equity of the company you own. Shareholders’ equity does not yield a fixed profit, such as bonds, and they may never make any profit (of course there is something like this: if a company cannot pay their debts, the bonds will not make any profit.)

Performance

The performance of an investment is a positive or negative value change that it will experience within a certain period of time.

The performance history shows the past performance of the investment in question. However, it should not be forgotten that the high performance in the past does not guarantee high performance in the future. Performance history shows only the past performance of the respective investment, that’s all.

Dividend Yield

Dividend (or modern dividends) is the payment of a company’s profit to its shareholders and the amount determined by the company’s board of directors. Dividend payments can be made through cash, more shares or other commodities.

Let’s say you invest in a company you bought, closed the year with profit. It may decide to distribute a part of the profit as dividends.

The dividend yield is the ratio of the dividend distributed by the company every year to the share price.

“Since the date of its foundation“

This term, which is generally used for mutual funds, refers to the date when the fund was established. For example, if you want to learn the performance history of a fund, you’ll be able to see all the performance of that fund since it was installed.

Trade

In the investment world, ”trading Yatırım comes to mind when it comes to trading. Trading of financial instruments such as stocks is also a trade arm.

In our previous publication, we mentioned the important economic indicator that every investor should know. Knowing these indicators can help you increase your return on investment. You can use this link to browse the related publication .

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