Here’s how this works…
Each week, we will introduce you to one new investing term that you’ll need to know if you want to start investing.
Then we’ll provide a summary of the past week’s financial news and explain why it’s relevant to you as a beginner investor and, more importantly, how you can use this knowledge to your advantage.
So, let’s get cracking!
TERM TO LEARN
STOCK MARKET TRANSACTIONS, ALSO KNOWN AS ORDERS, REFER TO THE VARIOUS WAYS IN WHICH STOCKS ARE BOUGHT, SOLD OR EXCHANGED IN FINANCIAL MARKETS.
Investors can use different types of orders:
Market Order: A type of order to buy or sell a security at the current market price.
Limit Order: A type of order to buy or sell a security at a specific price or better.
Stop Loss Order: A pre-defined order to sell a stock if it reaches a specific price, limiting potential losses.
Market-on-Close Order: An instruction to buy or sell a security at the market price during the closing auction.
Market-on-Open Order: An instruction to buy or sell a security at the market price during the opening auction.
Short Selling: Selling borrowed stocks in the hopes of buying them back at a lower price in the future.
INVESTMENT NEWS FOR BEGINNERS
UK’s February 2026 stocks possibly priced below estimated value.
The UK stock market (specifically the FTSE 100 and FTSE 250) has faced a bit of a rough patch in recent times. This is due to global economic concerns, such as weak trade data from China and general uncertainty in the markets. Because of this downturn, the share prices of many UK companies have dropped. Simply put, Wall St uses a mathematical model called ‘discounted cash flow’ (which is just a fancy way of guessing how much money a company will make in the future) to estimate what a company should be worth. Several UK-listed companies are currently trading at a discount, meaning their current market price is significantly lower than their estimated fair value. Essentially, there are potential bargains for investors who believe these companies will recover and grow in the long term.
Why this matters to you…
Buying the dip. For a beginner investor, buying a high-quality company when it is ‘on sale’ is a classic strategy to build wealth over time.
The concept of ‘value’. The idea that a stock’s price (what you pay) is not always the same as its value (what it’s actually worth). Learning to spot this gap is a core part of value Investing.
Dividends. Many of these undervalued UK stocks pay dividends (cash rewards to shareholders). Some UK renewable energy stocks are currently offering yields as high as 12%.
What you need to do…
Focus on fair value, not just price. Just because a stock is cheap (e.g., it costs £1) doesn't mean it’s a bargain. Look for the fair value estimates provided by analysts to see if there is a margin of safety.
Check the ‘why’. If a stock is trading at a 40% discount, ask why the market is afraid of it. Some companies have high debt or unstable dividends. A discount is only a bargain if the company is actually healthy.
UK banks earnings preview: Can Barclays and Natwest sustain profit momentum?
Barclays is reporting its full‑year 2025 results on 10 February 2026 and NatWest on 13 February 2026, and the market is watching closely. Investors are focusing on net interest margins (how much banks earn on loans vs what they pay on deposits), credit quality (how many loans may go bad) and capital returns (dividends and share buybacks). For the past couple of years, banks have made huge profits because interest rates were high (which allows them to charge more for loans). However, because the Bank of England has started to lower interest rates, experts are watching to see if the banks' glory days of record profits are coming to an end.
Why this matters to you…
The stock market barometer. Barclays and NatWest are huge companies in the FTSE 100 (the index of the UK's 100 biggest companies). If their results are bad, it can drag down the whole UK stock market, affecting even safe beginner investments like Index Funds or ETFs.
Inflation and bad debts: Learn about the concept of credit quality. For a beginner investor, this is a signal of how the average person is handling inflation. If the banks say they are worried about people not paying back loans, it’s a warning sign that the wider economy is struggling, which could impact your investments in the near future.
What you need to do…
Look past the big numbers. You might see a headline saying "Barclays makes £9 Billion Profit!" and think the stock will go up. However, the stock price often moves based on expectations. If the market expected £10 billion and they only made £9 billion, the stock might actually go down.
Watch the guidance. The most important part of these reports isn't actually what happened last year. It’s what the CEOs say about the next year. Listen for guidance, this is the bank's own prediction of their future. This usually moves the stock price more than the actual profit numbers.
Check your dividends. If you own these stocks through an app or an ISA, look out for the dividend announcement dates mentioned (Feb 10th and 13th). This is when you'll find out exactly how much passive income you'll be receiving in the coming months.
ECB holds interest rates at 2% after eurozone inflation drops in January.
In February 2026, the European Central Bank decided to keep its key interest rate at 2%. This is the fifth time in a row they have chosen not to change it. Even though inflation (the rate at which prices rise) dropped to 1.7% in January, which is actually lower than the ECB's "ideal" target of 2%, the bank decided to wait. They believe that while prices are cooling down (mostly because energy costs have fallen), the economy is stable enough that they don't need to rush into cutting rates further to jumpstart things just yet.
Why this matters to you…
Stock market performance. High interest rates usually act as a brake on the stock market because borrowing money is more expensive for companies. By keeping rates steady at 2% (which is considered relatively low), the ECB is signalling a ‘steady-as-she-goes’ environment, which is generally positive for stock prices.
Bond prices. For investors who buy bonds (loans to governments or companies), steady rates mean bond prices are likely to remain stable. If rates were to fall in the future, the value of the bonds you buy now would likely increase.
What you need to do…
Consider bonds for diversification. If you think the ECB might cut rates later in 2026 because inflation is so low, now might be a good time to learn about bonds. When interest rates eventually fall, the price of existing bonds usually goes up.
Focus on company quality. In a steady-rate environment, the best way to invest is to look for healthy companies with low debt. Since interest rates aren't falling rapidly to save struggling companies, you want to invest in businesses that can thrive on their own.
Think long-term about inflation. While 1.7% is low, the ECB expects it to hover around 2% for the next few years. As a beginner investor, your goal is to make sure your investment returns are higher than 2%. Otherwise, you are technically losing buying power every year.
Thanks for reading this 20th edition.
Buckle up, because it’s a massive week for your portfolio!
All eyes are on the big U.S. inflation report (CPI) dropping today. Everyone’s basically holding their breath to see what the Fed does next with interest rates.
On top of that, we’ve got a mountain of earnings reports from heavy hitters like Barclays and Unilever, giving us a real-world look at how the economy is actually holding up.
See you next week!