Process of spreading the investment across different types of investments to avoid the "too many eggs in one basket" problem.

Also known as "Volatility," risk is the swings, up and down, in the value of an investment.

A type of financial vehicle made up of a pool of money collected from many investors to invest in securities like stocks, bonds, money market instruments, and other assets.

(1) Investors pool their money in a fund, (2) A fund manager invests the money into a diverse set of securities, and (3) Investment returns generated (gains or losses) are shared by investors.

ETFs are similar in many ways to mutual funds. They generally track the price of an asset (like silver) or basket of assets (like the S&P 500). And as their name suggests, they trade on exchanges and can be bought and sold like stock via a traditional brokerage account.

Investing in equal dollar amounts at regular time intervals.

When you're evaluating companies, market caps help you compare those of similar sizes. Definitions for small, mid, and large cap companies differ and hange as the market waxes and wanes, but in general: Small Cap = $1 Billion or less, Mid Cap = $1 - $10 Billion, and Large Cap = Greater than $10 Billion.

Knowing these terms will help you navigate the investment world.

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