The essentials
Build your financial foundation.
Money, returns and risk are connected. These concepts help you compare products and understand how financial decisions work.
Compound interest
Compound interest occurs when earned interest is reinvested and generates further interest in later periods.
In plain languageDiversification
Diversification means spreading money across different investments to reduce dependence on individual risks.
In plain languageLiquidity
Liquidity describes how quickly an asset can be converted into cash at a reasonable price. For people and companies, it also refers to the ability to pay obligations.
In plain languageReturn
Return describes an investment’s gain or loss relative to the capital invested. It is often expressed as a percentage.
In plain languageRisk
Financial risk is the possibility that an investment or decision turns out differently than expected, particularly with a loss.
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03 / CONNECT THE DOTS
Knowledge that moves you forward.
Individual terms are the beginning.
Here’s how they fit together.
ETF vs stock: What is the difference?
One business or a whole basket? Understand diversification, costs and risk.
Read the guideCompound interest: When your earnings earn
Why time and reinvestment matter, with a worked example and the model’s limitations.
Read the guideInflation and purchasing power: What does your money buy?
Why a bank balance is only part of the picture, and how nominal and real returns differ.
Read the guide