Dictionary
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Coupon

Coupon

Also called a dividend, this is the fixed annual interest paid to gilt holders. It’s usually paid in two equal, semi-annual instalments and expressed as a percentage of the nominal value of the gilt.

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Net asset value

Mutual funds and investment trusts are priced on their net asset value (NAV).
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Retail Prices Index (RPI)

An index published each month by the Office for National Statistics, which measures the level of retail prices in the UK. Cash flows on all index-linked gilts are linked to the RPI.
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American Depository Receipts (ADRs)

Tradeable assets that let Americans invest in overseas stocks using US laws and dollars.
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Base rate

What's the base rate?
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Value stocks

Stocks in companies that aren’t necessarily growing fast, but instead are dependable and stable.
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Yield

Income from an investment as a percentage of its current price.
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Over-The-Counter (OTC)

A security that is sold outside of an exchange.
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Bond

Learn what a bond is
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Time Value of Money

The concept that money you have now is more valuable than the same sum in the future.
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