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IFC Mini Glossary

This page is a publication of Insight Financial Corporation. It is a small Glossary of investment terminology. If you do not know what something means, look it up below. If it is not here, please email us the word or expression, and if we can, we will send you a definition. To reduce spam, we have removed the period before the com in our email address. Please insert a period between heinzegroup and com to read heinzegroup.com to make the address legitimate. Also, we do use spam filters, which sometimes filter legitimate email, so please confirm that we received your email.


Asset Mix: The mix of different types of investments held in order to strike a balance of risk and return.

Balance your portfolio: Holding different types of investments to strike a balance of risk and return.

Bear Market: A declining market. One who expects the market to drop is said to be bearish.

Bull Market: A rising market. One who expects the market to rise is said to be bullish.

Capital: Financial assets including cash and securities.

Correction: Or Market Correction. When a hot market drops back to more reasonable levels. Historically markets go up, but along the way there are setbacks. These setbacks are often called market corrections. In theory they are correcting an overheated increase, in practice, this may or may not be true.

Covering a Short Position: After selling short, you must eventually buy the investment to cover your short position. This is called covering your short position. (See also Short Position).

Diversify: Spreading investment risk by holding securities of different companies in different kinds of businesses and/or locations.

Equity Investment: Investments in shares of companies.

Fixed Income investments: These are investments where the return, term and maturity value are set. So you know what your investment income will be. For example, guaranteed investment certificates, or bonds.

Hedge: A transaction intended to reduce the risk of loss from price fluctuations.

Liquidity: Ability to convert an investment into cash.

Load: The sales fee charged when buying or selling a mutual fund.

Long Position: Also referred to as going long. Refers to holding an investment that you have not sold, or buying it before you sold it. (Opposite to Short Position).

Management Expense ratio: Total management fees and other expenses charged to a mutual fund, expressed as a percentage of the funds assets.

Market Value: The amount that a security is currently trading for.

Portfolio: A group of investments.

Securities: Financial assets such as stocks, bonds, treasury bills, guaranteed investment certificates, etc.

Shares of a Company: Certificates of ownership of the company. The greater the number of shares, the more the holder owns. In theory there would be a certificate for each share, in practice a certificate indicates how many shares it represents. Note: The practice of issuing certificates to registered owners is declining and will probably be abolished one day. However, the owner will still own shares, they just will not hold a piece of paper to prove it.

Short Position: Also referred to as selling short. The act of selling an investment before you purchase it. A short position is when you have sold the investment, but have not yet purchased it. (See also Covering a Short Position). (Opposite of Long Position).

Speculating: Buying securities in the hopes of making money fast.

Speculative Investment: An investment with a high risk and high potential pay off.

Stocks: See Shares.

Volatility: The amount that an investment's value and return changes. A highly volatile investment will be subject to large fluctuations in value, while a low one will hold its value and provide more steady growth.

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