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.
Credit spreads: The difference in the yield of corporate bonds over equivalent government bonds.
Commodity: A raw material or primary agricultural product that can be bought and sold
FX: (Foreign exchange) Is the market in which currencies are traded.
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.
Income investing: Investing in funds or securities that promise regular cash returns (dividends).
Quantitative easing: The introduction of new money into the money supply by a central bank.
R&D: Research and development
Discount: When the market price of a security is thought to be less than its underlying value, it is said to be ‘trading at a discount’. Within investment trusts, this is the amount by which the price per share of an investment trust is lower than the value of its underlying net asset value. The opposite of trading at a premium.