At Union Bank, we want to make investing accessible to everyone, regardless of their background or experience. That’s why we’re excited to launch the next generation of investment management apps. This easy-to-use app makes managing your investments simple, approachable, and fun. In fact, you can start investing for as little as $10 and it takes just 4 minutes to set up right from your phone, tablet, laptop, or PC. This exciting new tool is available to all Union Bank customers who are enrolled in online or mobile banking with their checking or savings account.
Investing is more than just crunching numbers. It’s a way to achieve your financial goals, secure your future, and make your hard-earned money work for you. We know that the world of investing can be scary, full of confusing terminology and complex ideas, especially for beginners. Whether you’re interested in stocks, bonds, or other ways to invest, we’ll break down complex language into understandable language. It turns out that investing is not just for Wall Street financial experts. It is for common people like you who want to increase their savings and make their dreams come true.
Type of investment
assets
An asset is something of value that you own, such as money in the bank, a house, or stocks. You can make money or sell it if you need cash.
asset allocation
Asset allocation is like meal planning. You don’t just want to eat one type of food. A mix is required. In investing, it refers to spreading your money across different types of assets, such as stocks, bonds, and real estate, to balance risk and reward.
hook up
Bonds are like lending money to a friend, but in this case to a company or government. They promise to repay the loan with interest after a certain period of time.
dollar cost averaging method
This is an investment method in which you regularly purchase a fixed amount of stocks, etc., regardless of whether the price is high or low. It’s like buying groceries sometimes on sale and sometimes at full price, but always spending the same amount.
Exchange Traded Fund (ETF)
An ETF is a basket of different stocks and bonds that can be bought and sold like a single stock. It’s like buying a fruit basket and buying different types of fruit instead of buying individual fruits.
growth stocks
Growth stocks are stocks of companies that are expected to grow rapidly. It’s like betting on a young athlete who could become a star.
index fund
Index funds are similar to ETFs, but they try to match a specific group of stocks or bonds, such as the top 500 companies. It’s like copying a successful recipe.
investment trust
A mutual fund is a pool of money from many people managed by professionals. It’s like a potluck dinner where everyone brings their own food and everyone eats together.
portfolio
Your portfolio is everything you have invested in, as well as the various assets you own. Think of it as a financial garden with a variety of plants.
real estate investment trust
This is a way to invest in real estate such as malls or apartments without purchasing the entire building. It’s like owning part of a large piece of real estate.
return
Return is the money you gain or lose from your investment. If you buy an item for $10 and sell it for $15, your profit is $5.
safety
Securities is a fancy name for investments such as stocks, bonds, and mutual funds.
stock
A stock is a part of a company that you can buy.
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- Common Stock: This is like a full membership in a club. You have a say in big decisions, but if the club closes, someone else will get paid before you.
- Preferred Stock: It’s like a VIP membership. They get paid before regular members, but they don’t have as much say in decisions.
share
A stock is just one portion of a company’s stock. If a company is a pie, stocks are a slice.
General investment terms
averaging down
If you buy a stock and its price falls, lowering the average means buying more shares at a lower price. It’s like buying more of your favorite snack when it’s on sale to lower the average price you pay.
bear market
A bear market is when stock prices are falling and people are worried that they will continue to fall. Imagine a bear swiping down with its paw. That’s what the market does.
bull market
A bull market is the opposite of a bear market. This is when stock prices are rising and people are feeling optimistic. Think of a bull charging forward. That’s what the market does.
capital gain
Capital gain is the profit you make when you sell an investment for more than you paid for it. If he buys the bicycle for $100 and sells it for $150, his capital gain is $50.
compound interest
Compound interest is like a snowball rolling down a hill, getting bigger as it goes. You earn interest on the money you save, and then you earn interest on that interest, so your money keeps growing.
Diversification
Variety is like eating different types of food to stay healthy. In investing, it means spreading your money across different types of investments so that if one investment doesn’t work out, others might.
dividend
Dividends are paid to shareholders as part of a company’s profits. If you own stock in a profitable company, you may be able to receive some of that money as dividends.
IPO (initial public offering)
An IPO is a company’s first sale of shares to the public. It’s like an opening sale for a new store.
large stocks
Large-cap stocks are stocks of large, well-known companies. “Cap” stands for capitalization and refers to the total amount of a company’s shares. Think of them as big fish in a pond.
Liquidity
Liquidity is how easily an investment can be converted into cash. If you can sell it quickly without losing too much value, it’s liquid. It’s like having a liquid drink instead of a frozen drink. Easy to handle.
Market capitalization
Market capitalization is the sum of the value of all of a company’s stocks. It’s like a price tag for the entire company.
market index
Market indices are like a thermometer for the stock market. These track trends in specific groups of stocks and help people understand the overall health of the market.
risk tolerance
Risk tolerance is how much you are willing to lose money on an investment. It’s like choosing a ride at a fair. Some people prefer wild rides, while others prefer something more gentle.
small cap stocks
Small-cap stocks are stocks of smaller companies. It can grow quickly, but it can also be risky. Think of them as small, fast fish in a pond.
volatility
Volatility refers to how much an investment’s price will rise or fall. If it changes a lot, it has high volatility. “If an investment is historically very stable, volatility will be low.
retirement goods
401(k)
A 401(k) is like a workplace piggy bank where you can save money for retirement. Employers may also put money into it. Because your money is saved before taxes are applied, it can grow tax-free until you withdraw it.
Certificate of Deposit (CD)
a negotiable certificate of deposit This is like storing your money in a locked box at a bank for a fixed period of time, such as 6 months or 5 years. You can’t touch it until it expires without paying a penalty, but the bank pays higher interest than a savings account.
high yield savings account
a high yield savings account A savings account that pays more interest than a savings account. It’s like planting a seed in special soil that helps it grow faster.
Individual Retirement Arrangement (IRA)
Ann Individual retirement allowance system, or IRA, is a special account where you can save money for retirement. Depending on the type of IRA, your money may grow tax-free, or you may not be able to pay taxes now or later.
robo advisor
Robo-advisors, also known as “automated investment services,” use computer algorithms and software to build and manage investment portfolios. Robo-advisors are a low-cost alternative to financial advisors.
Rollover IRA:
a Rollover IRA This is similar to moving your retirement savings from one piggy bank to another, usually when you change jobs. This allows you to keep all your tax benefits without having to start over.
Roth IRA:
a Roth IRA is a special type of retirement account in which you pay taxes on the money you deposit, but not when you withdraw it. It’s like when you pay the park entrance fee, you get all the rides for free.
Take control of your future with Union Bank’s new mobile investing app
With our new features, your financial journey begins in just a few clicks. IAn investment management tool available to individuals who have a Union Bank checking or savings account and are enrolled in online or mobile banking. When you open the Union Bank app, you’ll see an investment tile next to your other accounts. Follow the prompts to register. It’s that easy!
At Union Bank, we are committed to helping you grow your savings and realize your financial dreams. Together, we can transform the complex world of investing into opportunities that are accessible and rewarding to everyone in our Vermont and New Hampshire communities. The Union Bank mobile app provides investment tools for the public.click here Learn more about our exciting new digital investing app here.
Please note that certain investment products, including but not limited to IRAs and 401(k)s, are not insured by the FDIC and carry the risk of potential loss of value. Before investing, please be sure to understand the risks involved and, if appropriate, consult a financial professional.
