A quick-reference glossary of the terms used across FundHolding's guides. For deeper explanations, follow the links through to the full articles.
Accounts & tax wrappers
ISA (Individual Savings Account)
A UK tax wrapper that shelters investment growth and income from Capital Gains Tax and further income tax, up to an annual subscription limit. See our Stocks & Shares ISA guide.
SIPP (Self-Invested Personal Pension)
A personal pension wrapper that lets you choose your own investments, in exchange for tax relief on contributions. See our SIPPs section.
GIA (General Investment Account)
An unwrapped investment account with no tax shelter, typically used once ISA and pension allowances are used up.
LISA (Lifetime ISA)
An ISA variant for under-40s that adds a 25% government bonus on contributions, usable towards a first home or from age 60.
JISA (Junior ISA)
A tax-free account held in a child's name, managed by a parent or guardian until the child turns 18.
Fund structures
ETF (Exchange-Traded Fund)
A fund that trades on a stock exchange throughout the day, like a share, typically tracking an index at low cost.
OEIC (Open-Ended Investment Company)
A UK open-ended fund structure that creates or cancels units to meet investor demand, priced once a day.
Unit Trust
An older open-ended fund structure, legally a trust rather than a company, functionally similar to an OEIC.
Investment Trust
A closed-ended fund listed as a public company on the stock exchange, with a fixed number of shares that can trade at a discount or premium to its underlying assets.
Index Fund / Tracker Fund
A fund designed to replicate the performance of a specific market index rather than trying to beat it.
Costs
OCF (Ongoing Charges Figure)
The standard measure of a fund's annual running cost, expressed as a percentage of the amount invested.
TER (Total Expense Ratio)
An older, broadly similar measure to the OCF, now mostly superseded by it in UK fund literature.
Platform Fee
The charge levied by the investment platform or broker itself, separate from the fund's own charges.
Tracking Error
The degree to which a fund's returns deviate from the index it is meant to be tracking.
Portfolio & strategy
Asset Allocation
The mix of asset classes (such as equities, bonds, property, and cash) held within a portfolio.
Diversification
Spreading investments across different assets, sectors, and regions to reduce the impact of any single holding performing badly.
Rebalancing
Periodically adjusting a portfolio back to its target asset allocation as markets move it out of line.
Accumulation (Acc) Units
Fund share classes that automatically reinvest income back into the fund rather than paying it out.
Income (Inc) Units
Fund share classes that pay income out to the investor, typically as cash.
Gearing
The use of borrowed money by an investment trust to increase its exposure to markets, amplifying both gains and losses.
NAV (Net Asset Value)
The total value of a fund's underlying assets, minus liabilities, often expressed per share or per unit.
Tax terms
CGT (Capital Gains Tax)
Tax on the profit made when an investment held outside a tax wrapper is sold at a gain, above the annual exempt amount.
Dividend Allowance
The amount of dividend income you can receive each tax year outside an ISA/SIPP before dividend tax applies.
Annual Allowance (Pensions)
The maximum amount that can be contributed to pensions each tax year while still benefiting from tax relief.
This glossary is provided for general educational reference only and is not exhaustive or a substitute for professional advice. See our full disclaimer.