Mastering Personal Finance: 5 essential terms you must familiarize yourself with


Understanding is priorty!

    Understanding income, expenses, profits, losses, and wealth creation in the market demands constant learning and unlearning of a variety of terms and concepts.

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Asset Allocation

    The deliberate division of investments among different asset classes, such as stocks, bonds, cash, and alternative assets like real estate and commodities, is known as asset allocation.

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Bear Market

    A bear market is an extended period of falling investment prices, usually indicated by a significant drop in major market index values of at least 20% from recent peaks.

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Bull Market

    A bull market is defined as an extended stretch of rising prices in the financial markets; this phenomenon is most commonly seen in the stock market but may also be applied to other asset classes such as bonds or real estate.

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Blue-Chip Stocks

    Owning blue chip stocks denotes ownership in big, stable corporations that are regarded as safe and reliable investments because of their stability and reliability.

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Bottom-up investing

    This places more emphasis on examining individual businesses than macroeconomic variables; one should begin by assessing a few companies and work their way up to determine the portfolios potential as a whole.

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