Investing for beginners in the UK (part 2): Boost your trading skills

Meet Finder’s investment experts

Our team can help you navigate the world of investing. We start with the basics – like why people invest – explain the jargon and offer practical tips.

Definitions

There’s a wealth of terminology in share trading that you’ve got to get your head around when learning about investing. Here are some of the key ones you might come across when investing, so you’ll be up to speed and looking like a pro in no time.

What are shares?

Whether you own a few shares or you’ve not quite got started yet, here’s the lowdown of what shares actually are.

What is a stock portfolio?

A portfolio is a collection of investments — here we explain stock portfolios, how to manage your portfolio and the importance of diversification.

What is a broker?

A stock broker is what you’ll use to carry out your trade. online brokers, also known as trading apps, investment platforms and investment apps let you buy and sell shares within an app or on their website.

What is trading volume?

Trading volume refers to the total number of shares exchanged between buyers and sellers each day. Discover how it works and how you can use it to your advantage.

What is market cap?

Market cap (or capitlisation) refers to the total value of a publicly listed company’s shares. Find out how you can use this metric to your advantage when you are trading.

What are dividends?

Sometimes companies will give you a slice of their profits for owning shares, called dividends. Here’s what you’ll need to know.

What is a stock market crash?

A stock market crash doesn’t have to derail your investment strategy — the key is to not panic. We’ve explained how to prepare for and deal with a stock market crash.

What is a bull market?

A bull market makes investors feel confident, or “bullish”, so stock market prices are on the rise. Find out the phases of a bull market and how long they last.

What is a bear market?

Bear markets can give investors a sense of impending doom, with stock prices on a downward trajectory, but there are signs that there’s one incoming. Find out how bear markets work and how long they typically last.

What are investment goals?

Why have you decided to invest — saving for a first home? Preparing for retirement? Maybe you have no goal, and simply find it enjoyable? Here’s your guide to investment goals.

What is an IPO?

When a company wants to list on an exchange, it carries out an initial public offering (IPO), so you’ll be able to buy their shares.

What is insider trading?

Insider trading is where trades are made from the knowledge of confidential information, usually from someone inside the company, hence the name. Find out more about insider trading and why it’s prohibited.

Investment types

Shares aren’t the only things you can invest in — you can buy gold, soybeans, oil and bonds. There are also several types of shares, including pink sheets, penny stocks, blue chip stocks and fractional shares. Here are some of the different things you can invest in.

Commodities

Commodities are economic goods that are fungible, which means that it doesn’t matter who manufactured them, they’re considered to be interchangeable. See how you can trade them.

Exchange traded funds

Exchange-traded funds are a type of fund that are listed on a stock exchange. This means that they have live prices and are easier to trade. Learn the types of ETFs, how they’re created and how to trade them.

Ready made investments

Not everyone has time to create and manage a portfolio — ready-made portfolios let you get exposure to investments without all of the work.

Index funds

Index funds are designed to match the market, not beat it. You can choose a stock market index that you want to track and find a fund that tracks it, known as an index fund.

ETFs vs index funds

Exchange-traded funds and index funds are both collections of stocks that you can trade. We reveal how they differ and the benefits of each kind of fund.

ETFs vs mutual funds

Exchange-traded funds and mutual funds are both types of funds, but they’re traded quite differently. Discover the similarities, differences and benefits of ETFs and mutual funds.

Penny stocks

Penny stocks are stocks that cost…pennies. These are typically less than £5, but this doesn’t mean you’ve found an undervalued stock. Discover what penny stocks are and how they’re traded.

Pink sheet stocks

Pink sheet stocks are stocks that aren’t listed on major stock exchanges and traded over-the-counter. Here’s some pink sheet stock examples, where you can buy pink sheets and where they got their name.

Gilts

A gilt is an IOU from the government, also known as a government bond, and is generally considered to be more safe than other investments types. Here’s how they work.

Ethical investing

If you want to align your investments with your morals, you can choose to invest ethically. We’ve explained how it works and some of the terminology in ESG investing.

Fractional shares

You can invest in a fraction of a share rather than buy an entire one, which lets you diversify if you only have a small amount to invest. We’ve summarised where you can buy fractional shares.

Cryptocurrencies

Cryptocurrencies are becoming a popular investment. They’re digital currencies that aren’t centralised. While you can have them as well as other investment types, you may not be able to hold them with the same provider as your other investments. Here’s what you need to know.

Investing in overseas shares

Investing in overseas shares gets you exposure to other countries, so it’s great for diversification. There are a few things you’ll want to consider, here’s what you need to know.

Analysis

Stock analysis lets you effectively monitor share performance — this helps you work out if stocks are under- or overvalued and understand annual reports. These guides help you strategise and monitor shares.

Technical analysis

Technical analysis is a way of monitoring shares to predict future price movements. Here’s how it works.

How to read annual reports

Annual reports come but once a year, as the name suggests. These give some great insight into a company’s performance, but they’re so full of jargon, they might as well be written in a different language. We’ve explained how to read them.

Fundamental analysis

Fundamental analysis helps you decide how much as share is worth based on several metrics. Here’s how its worked out and how to learn how to analyse stocks yourself.

Stock market trading hours

Stock markets aren’t open 24/7, and their opening hours are local to the exchange. This can be beneficial, as there’s typically always a stock market open somewhere, but it might mean you’ve got to be an early riser to get access to some of the stocks you want.

Investment strategies

An investment strategy determines how you’ll trade, such as the types of investments you’ll trade and when you’ll choose to buy or sell. Our guide explains some investment strategies to help you create your own one.

Best time to invest in stocks

Is there a best time to invest in stocks? How can you determine when is best? We’ve explained how to time your trades.

Shareholder voting rights

Shareholders can get stock voting rights, which means you can vote on some of the company decisions. This can depend on how many shares you own — here’s what you need to know about stock voting rights.

How to sell shares

You might choose to sell a share because it’s not performing well, or because it’s performed excellently and you want to reap the rewards. Here’s how to do it.

How to monitor share performance

How do you know if your shares are doing well or if its time to sell? We’ve explained how you can monitor the performance of your shares to make a decision on selling or holding them.

Investment tax and tax-free accounts

Nobody likes paying tax. Luckily, there are plenty of account types with tax-free allowances. These account types are called “tax wrappers”. Here’s more information about investment tax and some of the accounts that you can use.

Tax wrappers

Struggling to understand the difference between all the accounts on offer from your chosen provider? We explain the tax benefits and how each one is used.

LISAs

A lifetime ISA (LISA) is an account type that’s great for anyone saving for their first home or retirement that can get you a 25% top up from the government.

Pensions

You might think you’re too young to worry about your pension, but it’s got some great tax benefits, making it a really efficient way to save and invest.

Dividend tax

If a company pays out dividends — little slices of its profits — then you may need to pay tax on what you receive. We’ll explain your allowance and how it works.

Investment tax

Investing can earn you great profits or an income, so you may need to pay tax on your profits. We’ve summarised how investments are taxed.

W-8BEN form

A W-8BEN form is used to clarify your tax status when you’re buying US shares. Here’s what it’s for and how to fill one out.

Tools

Investment tools can be really helpful when learning how to invest — you’ll want to know the different types of order, how stock charts can be used and how to practise more complex investment types and strategies.

Order types

Different order types let you make orders based on price or fluctuation, which you can specify. Find out some order types and how to make the most out of them.

Stock market charting

Once you’ve got to grips with investing, you’ll want to turn your attention to stock charts. Learning to understand charts is a great tool for spotting patterns and making predictions

What is a demo account for trading?

A demo account can give you a chance to get to grips with a platform before investing real money. They’re an excellent tool for learning both the basics and more complex strategies. Here’s some providers that have demo accounts.

Useful investment guides

Want to know more about stock exchanges, which companies you can invest in and whether you need investment advice? We answer all of these questions in our general investment guides below.

How stock exchanges work

Stock exchanges are where shares are exchanged between buyers and sellers. Here we’ll explain how they work.

Stock market prices

What sends a stock price spiralling? Why does a share surge all of a sudden? We explain why stock prices fluctuate and how to predict price changes.

Why can't I invest in all companies?

Your favourite independent coffee shop or confectionary brand may not be listed on a stock exchange. Here’s your guide to stock market listings.

Myths about the stock market and investing

Is investing a type of gambling? Do you need to be rich to invest? We debunk some of the common myths about investing.

Best shares for beginners

Here are some shares that are suitable for beginner investors — these are mostly long standing blue chip stocks that have a high market cap. It’s important to note that this doesn’t mean that thay’re safe.