Financial Flashcards
(8 cards)
Ways to fund an investment?
Savings - Utilising personal savings to fund investments.
Loans - Borrowing from banks or financial institutions; may involve interest payments.
What is rate of return?
This is the profit you receive on your investment as a percentage of the original investment.
What is the rate of return formula?
Profit from original investment/original investment x 100/period of investment (years)
What is investment diversification?
diversifying your investments means spreading your money across different investment types in order to spreading the risk
What are types of investments?
stocks - equity shares representing
ownership in a company;
potential for high returns but
also high risk.
bonds - debt securities issued by
corporations or governments;
generally lower risk and stable
returns.
What is a share market?
a platform for buying and selling shares of publicly traded companies.
What is budgeting?
a financial plan that outlines expected income and expenses over a period.
What is ethical investing?
investing in certain companies/organisations, whos products, policies, and practices line with their own beliefs
