Closed-ended: Closed-end funds have a fixed number of shares and are traded among investors on an exchange. Like stocks, their share prices are determined according to supply and demand, and they often trade at a wide discount or premium to their net asset value.

Open-ended: An open-ended investment company (OEIC) is a type of company or fund in the United Kingdom that is structured to invest in other companies with the ability to adjust constantly its investment criteria and fund size

Gearing: A measure of a company’s leverage that shows how far its operations are funded by lenders versus shareholders. It is a measure of the debt level of a company. Within investment trusts it refers to how much money the trust borrows for investment purposes.

Liquidity: The ability to buy or sell a particular security or asset in the market. Assets that can be easily traded in the market (without causing a major price move) are referred to as ‘liquid’.

Tracker Fund: Index tracker funds aim to mirror the performance of an index, e.g. a FTSE 100 tracker fund will buy shares in all 100 companies in the index in proportion to the size of the companies in the index

Bear market: A financial market in which the prices of securities are falling. A generally accepted definition is a fall of 20% or more in an index over at least a two-month period. The opposite of a bull market.

Bull Market: A financial market in which the prices of securities are rising, especially over a long time. The opposite of a bear market.