Common Investment Terms
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Investing in the stock market requires understanding key financial terms that frequently appear in analysis, news, and reports. Terms like equity, debt, market cap, P/E ratio, dividend yield, ROI, CAGR, and NAV are foundational to interpreting market data and making informed decisions. For example, "market cap" helps categorize companies into large-cap, mid-cap, or small-cap, while the "P/E ratio" compares a company's current share price to its earnings per share. "Dividend" refers to the portion of profits distributed to shareholders, while "ROI" measures investment returns. "CAGR" reflects the annual growth rate of an investment over a specific period. Additionally, terms like "bull market," "bear market," "volatility," and "liquidity" help investors understand market behavior and trends. This section breaks down 50+ essential terms with practical examples, making them easy to grasp even for those with no financial background. By mastering this terminology, learners will be better equipped to read financial news, understand analyst reports, and converse confidently in investment discussions.