Asset allocation is an investment strategy that aims to balance risk and reward by apportioning a portfolio’s assets according to an individual’s goals, risk tolerance and investment horizon. The three main asset classes – equities, fixed-income, and cash and equivalents – have different levels of risk and return, so each will behave differently over time.

Private equity, at its most basic, is equity—shares representing ownership of, or an interest in, an entity—that is not publicly listed or traded. Private equity is a source of investment capital that comes from high net worth individuals and firms. These investors buy shares of private companies—or gain control of public companies with the intention of taking them private and ultimately delisting them from public stock exchanges. Large institutional investors dominate the private equity world, including pension funds and large private equity firms funded by a group of accredited investors.

A real estate limited partnership (RELP) is a limited partnership entity organized to invest in real estate. A RELP is typically organized with an experienced property manager or real estate development firm serving as the general partner. Outside investors are sought to provide financing for the real estate project in exchange for a share of ownership as limited partners.

A fixed-income security is an investment that provides a return in the form of fixed periodic interest payments and the eventual return of principal at maturity. Unlike variable-income securities, where payments change based on some underlying measure—such as short-term interest rates—the payments of a fixed-income security are known in advance.

The Certificate of Deposit Account Registry Service (CDARS) is a program that allows the public to spread money around various banks. The purpose of CDARS is to help people who invest in certificate of deposits (CDs) to stay below the Federal Deposit Insurance Corporation (FDIC) insurance limits at any given bank. CDARS also provides a way for consumers to access multi-million-dollar FDIC insurance on CD investment principal and interest and to have someone else manage the risk of bank failures for them.

Convertible preferred stocks are preferred shares that include an option for the holder to convert the shares into a fixed number of common shares after a predetermined date. Most convertible preferred stock is exchanged at the request of the shareholder, but sometimes there is a provision that allows the company, or issuer, to force conversion. The value of a convertible preferred stock is ultimately based on the performance of the common stock.

Sometimes you need cash from your accounts without all the extra paperwork. Get a debit card and use it to make bill payments or withdraws.

A global fund is a fund that invests in companies located anywhere in the world including the investor’s own country. A global fund seeks to identify the best investments from a global universe of securities. Global funds may also be passively managed. A global fund can be focused on a single asset class or allocated to multiple asset classes.

Thinking about loved ones after you pass? Talk to us about estate planning and setting up a trust, how to avoid unnecessary additional probate taxes, and general planning for leaving accumulated wealth.

Though related, also entirely different. Here’s Investopedia’s explanation of the two.