Glossary
The key terms around stocks, explained briefly and clearly.
A
- Accumulating (thesaurierend)A fund or ETF that does not pay out dividends but reinvests them automatically.
- Advance lump-sum tax (Vorabpauschale)A notional minimum return on funds and ETFs that is taxed every year, even if you sell nothing.
- Annual general meeting (Hauptversammlung)The yearly meeting of a company's shareholders, where key decisions are voted on.
B
C
- Capital gains tax (Abgeltungsteuer)Germany's flat tax on investment income: 25 % plus solidarity surcharge, i.e. 26.375 %, plus church tax if applicable.
- Compound interest (Zinseszins)The effect of earnings generating further earnings, so your wealth grows at an accelerating pace.
- CrashA sudden, very steep drop in stock prices within a few days or weeks.
D
- DAXGermany's benchmark index, made up of the 40 largest listed German companies.
- Distributing (ausschüttend)A fund or ETF that regularly pays dividends and interest out to you.
- Diversification (Diversifikation)Spreading your money across many different investments to reduce the risk of any single loss.
- Dividend (Dividende)The part of its profit that a company pays out to its shareholders.
- Dividend yield (Dividendenrendite)The dividend per share relative to the current share price, expressed as a percentage.
E
I
L
M
- Market capitalization (Marktkapitalisierung)A company's stock market value: share price times the number of all shares issued.
- Market order (Market-Order)An order without a price limit, executed as fast as possible at the next available price.
- MSCI WorldA stock index of well over 1,000 large and mid-sized companies from 23 developed countries.
N
O
P
R
S
- Saver's allowance (Sparerpauschbetrag)The annual tax-free allowance for investment income: 1,000 euros for singles, 2,000 euros for jointly assessed couples.
- Savings plan (Sparplan)An automatic, regular investment of a fixed amount into ETFs, funds or stocks.
- Share price (Kurs)The current price at which a stock or other security is traded.
- Shareholder (Aktionär)A person or institution that owns shares in a company.
- SpreadThe difference between the buying price (ask) and the selling price (bid) of a security.
- Stock (Aktie)A security that gives you a small ownership share in a company.
- Stock exchange (Börse)A regulated marketplace where stocks and other securities are traded.
- Stock split (Aktiensplit)Dividing one share into several new shares without changing the value of your holding.