Jargon Buster

Investment trusts

A type of pooled investment through which you buy shares in a company that then invests in other investments.
Investment trusts issue shares and are quoted on a stock exchange. They are closed-ended as there are a set number of shares available.

Investment / insurance bonds

An investment plan that often has an amount of life assurance included within the product. They are also known as life assurance bonds and with profits bonds.

Interest rate

In the context of loans and mortgages, the figure that determines how much interest you pay.
In the context of savings, the figure that states how much interest you receive.


The amount earned by your savings. Interest can be variable (it goes up or down) or can be a fixed amount.

Initial Public Offering (IPO)

A company's first offer of shares on a public stock market. Also referred to as ‘going public’ or a flotation. When a company reaches a certain stage in its growth it may decide on an IPO as a way to generate funds for working capital, debt repayment, acquisitions or a host of other uses.

Inflation risk

The risk that your money will lose value over time. Your buying power goes down as prices increase. An investor therefore needs to earn more than the inflation rate to get a ‘real return’ on their money.


A rise in the general level of prices of goods and services in the economy over a period of time.

IFA (Independent Financial Adviser)

A professional who advises on suitable financial products after having determined your circumstances, your needs and having researched the whole market. Some IFAs may opt to be paid by way of commission, however many also offer the opportunity to pay a fee for the financial advice that they provide.

Identity fraud/theft

When someone steals your personal details and uses them to pretend to be you. In doing this, they may attempt to steal money from your bank account, spend money on your credit card, or take out a loan in your name.