Average annual dividend yield: The average yearly income a company returns to shareholders as dividends, shown as a percentage of its share price. It is often used by income-focused investors to compare the cash-generating appeal of different stocks.
EBITDA: Short for earnings before interest, tax, depreciation and amortisation. It is a measure used to assess a company’s underlying operating performance by stripping out financing decisions and certain non-cash accounting charges.
Hawkish: A term used to describe a central bank or policymaker that is more inclined to raise interest rates or keep monetary policy tight in order to control inflation, even if that may slow economic growth.
Leverage: The use of borrowed money to increase potential returns. While leverage can amplify gains, it also increases risk because losses are magnified and debt still needs to be repaid.
Tail risk: The risk of a rare but severe event that sits at the extreme ends of a probability distribution. In markets, this refers to unlikely shocks that can still have a significant impact on portfolios.
Volume growth vs value growth: Volume growth refers to selling more units, while value growth means increasing the total revenue generated. A business can grow volumes without growing value if prices fall, and vice versa.
