Rebalancing, or rebalanced

Real Estate Investment Trusts, or REITs, enable investors to invest in property through a company - called a REIT - that finances, owns, or operates real estate that generates income. REITs can include cell towers, data centres, commercial and residential property, such as warehouses, retail centres and malls. One of the world’s largest REITs, is ProLogis, which provides warehouses for companies that need shedloads of floor space, such as Amazon, Walmart and DHL.

REITs have special tax status in the US. Their status means they're exempt from paying corporate income tax but must pass on 90% of their profits as dividends to shareholders- some of these can be as high as a nearly 30% dividend yield. This means REITs can suit investors seeking to generate income while they hold shares over the long term. Historically, REITs have been one of the top asset classes in times of high inflation because over time, rents typically rise to help offset this increase. Learn more about REITs.

Rebalancing refers to index going through a periodic adjustment of an index’s companies, called constituents or components. Rebalancing involves moving (higher or lower), or adding or removing constituent stocks within an index, such as the S&P 500. This keeps the index relevant and reliable. For example, if an index tracks the tech sector, a rebalance may remove companies that have shifted away from tech, or adding new tech firms. The S&P 500 is rebalanced quarterly, but it may be rebalanced mid-way through a quarter if companies have been impacted by mergers and acquisitions, bankruptcies, or delisting from an exchange, which affect a company’s value.

Ratings, or analyst ratings, are the findings made by analysts about the value of a company’s stock. Ratings can help investors decide whether to buy, sell, or hold an asset, like a company shares. Analysts look at financial performance, industry trends, and a company’s management. Ratings can range from ‘buy’, ‘sell’ or ‘hold’, which may help investors make their investment decisions.

A retail investor, or everyday investor, is a person - as opposed to an investment firm - who puts money into an investment, such as shares listed on the share markets. They typically do this hoping to make a personal profit through capital gains, returns, or gain an income from dividends. Their decisions are influenced by factors like risk tolerance, investment goals and market conditions. Successful investors do thorough research, keep informed about economic and share market trends, and strategically manage their portfolios.

Between 2019 and 2021, more than 10% of Kiwis started investing shares for the first time. Here are media articles from the time:

• Stuff: What kind of share market investor are you?
• Stuff: What's next for retail investors?

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Real Estate Investment Trusts, or REITs, enable investors to invest in property through a company - called a REIT - that finances, owns, or operates real estate that generates income. REITs can include cell towers, data centres, commercial and residential property, such as warehouses, retail centres and malls. One of the world’s largest REITs, is ProLogis, which provides warehouses for companies that need shedloads of floor space, such as Amazon, Walmart and DHL.

REITs have special tax status in the US. Their status means they're exempt from paying corporate income tax but must pass on 90% of their profits as dividends to shareholders- some of these can be as high as a nearly 30% dividend yield. This means REITs can suit investors seeking to generate income while they hold shares over the long term. Historically, REITs have been one of the top asset classes in times of high inflation because over time, rents typically rise to help offset this increase. Learn more about REITs.

Risk refers to the chance investments might fluctuate - known as share price volatility - which is the short term up and down movement of share values in the share market. Volatility in the share markets is considered usual, and investors need to manage their emotions around risk and volatility.

A roadshow refers to sales presentations the company delivers to large institutional investors before an IPO when they list publicly on a share market. The company's leadership team - the issuer - holds a series of meetings with potential investors to generate interest in their IPO.

For IPOs in the US, the S-1, also known as a registration statement, must by law include any material information about the company. This is so potential investors can understand what the company does, why it is issuing shares through an IPO, the state of the company's finances - including revenue, profit and debt -and what type of ownership structure is being offered. This document must be filed with the US Securities and Exchange Commission (SEC) before a company can list shares for sale on the US share markets. There are other ‘S’ versions as well, depending on the type of company going public. In other countries, this might be called a prospectus. The company must provide financial statements as part of these documents.