A plain-English glossary for words that confuse beginners. Tap one to open it.
Share
A small, tradeable piece of ownership in a real company. You own a fraction of its profits and its future.
Mutual fund
A pool of many people's money, managed by a professional, spread across many shares or bonds so one company's bad week does not wreck your savings.
Dividend
A portion of a company's profit paid directly to shareholders, usually once or twice a year.
Treasury bill
A short-term loan to the government, usually for 91 to 364 days, in exchange for a fixed return.
Bond
A longer-term loan to a government or company that pays a fixed rate of interest until it matures.
Core and satellite
Keeping most of your money in a broad, diversified fund, with a small optional slice in individual bets on top.
NGX
The Nigerian Exchange, where shares of Nigerian companies are bought and sold.
Index fund
A fund that simply buys everything in a market index, like the NGX 30, instead of paying a manager to pick winners. Cheap, broad, and boring on purpose.
Money market fund
A fund that holds very short-term, low-risk instruments like treasury bills. Built to preserve money, not grow it. The parking spot, not the journey.
Unit price
What one unit of a fund costs today. Your balance is simply your units multiplied by today's unit price, which is why it moves daily without anyone touching the account.
Domiciliary account
A Nigerian bank account that holds foreign currency, usually dollars, pounds or euros. Often shortened to dom account. It holds the currency; it does not invest it.
Parallel rate
The street price of the dollar in naira, set by supply and demand outside the official window. Usually higher than the official rate, and the gap between the two is where a lot of quiet cost hides.
Compounding
Growth earning its own growth. Small, steady returns stack on each other until, given enough years, the growth starts outearning your own deposits.
Diversification
Spreading money across many companies or assets so no single failure sinks you. The reason a fund of forty companies sleeps better than a bet on one.
Equity
Ownership. Equity in a company means shares; an equity fund is a basket of shares. When Nigerians say the stock market, they mean the equity market.
BVN
Bank Verification Number, the single identity number tied to your biometrics across every Nigerian bank account you own. Most investment platforms ask for it once at sign-up.