UK Accounting Glossary
Persons or organisations which have provided money to a business in exchange for a share of ownership.
A person or organisation who invests money in order to make a profit.
An investor is a person or entity that purchases assets with the objective of receiving a financial return. The assets an investor may buy range widely, but include stocks, bonds, real estate, commodities, and collectables (e.g. art). The portfolio of an investor commonly includes a variety of assets that balance the rewards and risks of each investment. An investor is distinguished from a speculator, who seeks to make quick, large gains from price increases on risky assets. Generally, an investor has a longer time horizon for achieving a return, which may include regular cash payments from the income the asset generates, capital appreciation from the rise in the asset price, or both. A young investor tends to buy assets with price appreciation potential, because a 25-year-old investor has many years for the asset to appreciate before the funds are needed for retirement. An older, retired investor ordinarily seeks income and thus wants assets that offer regular cash payments.
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This glossary post was last updated: 23rd December 2018.