January is where all those “I’ll sort it next year” moments and prior good intentions are suddenly in the present.

That’s why this month at Chip we’re focusing on simple ways to get control of our money and feel a bit more organised.

Last week, we looked at savings challenges, with fun, motivating ways to build better habits.

This week, we’re tackling the real-life money situations people find themselves in right now. If any of them sound familiar, you’re not alone – and there’s an easy next step.

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1. “I haven’t used any of my ISA allowance”‍

Your ISA allowance resets in April and if it's been quietly sitting there unused, January is a good time to revisit it.

ISAs let your money grow tax-free¹, which makes it one of the most valuable tools for long-term saving – yet many people don’t take advantage of them.

Your ISA allowance doesn’t roll over either, so it’s important to use it before you lose it after 5 April.

¹Chip does not provide tax advice. Tax treatment depends on individual circumstances and may be subject to change in the future.

How Chip can help:

The Chip Cash ISA gives you a tax-efficient place to hold your savings, while still keeping access when you need it.

You can deposit up to £20,000 per tax year, earn interest tax-free, and stay flexible if plans change. It’s a simple way to make sure more of your money stays yours as your wealth grows.

Pleae note that the Chip Cash ISA is now closed to new customers.

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2. “My money is just sitting in my current account”

This is one that many of us are guilty of. In fact, it’s estimated that £526 billion is currently sitting idle in current accounts.

We get it, our salary is paid in, and it can be easy to just leave it there. But If your spare cash sits in your current account earning 0%, it’s likely losing value to inflation when it could be earning interest.

Current accounts are great for day-to-day spending, but not so great for holding onto money you’re not actively using.

How Chip can help:

The Chip Instant Access account lets your money start earning interest straight away, with unlimited withdrawals that arrive in seconds, whenever you need it.

It’s ideal for cash you want to spend in the short-term; so you can use it to top your current account as you go, while you pocket that extra interest.

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3. “I’ve got something coming up this year I’m saving for”

A holiday. A wedding. A house move. For a big life moment, January is often when those plans start to feel real – and so does the need to save for them.

But it’s not just about saving. The hard part can be staying on track. This is where ‘unlimited access’ isn’t actually that helpful, and some guard rails can come in handy.

How Chip can help:

The Easy Access Saver is designed for short-to-medium-term goals. With up to three penalty‑free withdrawals a year, it gives you structure without locking your money away; helping you stay focused on what you’re saving for.

It’s a gentle nudge towards consistency, and a simple way to avoid temptation and impulse purchases.

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Making it easy to get started:

Whichever situation you’re in, getting your money organised doesn’t need to be complicated. With all Chip savings accounts, you can:

Deposit in just a few taps using seamless Open Banking technology.‍

Move money instantly between accounts to suit your needs.‍

Set up automatic recurring deposits, so saving happens before you even think about it.

Less effort, less account admin, just more progress towards your goals. Use Chip to give your money a setup that works for the year ahead, so you can focus on your other resolutions this year.

Clean energy isn’t just about climate headlines or ‘going green’ anymore; it’s now a serious industry and a fast-growing investment opportunity.

What started as a niche, policy-driven sector is now a global growth engine, attracting billions in capital and reshaping how we power our world.

Energy companies, infrastructure providers, and technology firms are all benefiting, and potentially, so could investors.
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Three reasons to take notice

The pursuit of net-zero and the need for cleaner energy solutions isn’t confined to one region or developed economies, it’s truly global.

1. UK leads on solar and wind

Here at home, the UK has approved over 16 GW of new renewable projects this year – that’s almost double last year’s figure. Solar power is having a record run too, already generating more electricity in 2025 than in all of 2024.¹

2. US investment hits new highs

Across the Atlantic, the US clean energy sector attracted more than $300bn in investment last year, boosted by policy support like the Inflation Reduction Act. Wind, solar, and EV infrastructure are all scaling up rapidly.²

3. Asia doubles down on renewable growth

China remains the world’s biggest investor in renewables, rolling out huge capacity in solar and batteries.³ Meanwhile, India is quickly catching up, with its renewable output expected to grow 10% this year alone.⁴

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Why it matters for you

Clean energy is no longer a future promise — it’s happening right now. Policy support, infrastructure spending, and technological advances are all driving investment opportunities in this space. 

So for long-term investors, exposure to clean energy generation, renewables, storage, and supporting sectors could be an important part of any portfolio focused on future growth.

Always remember, when considering a specific sector, a diverse portfolio across different asset classes, industries and regions can manage risk and smooth returns.

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How Chip can help you take advantage

At Chip, we offer a range of thematic funds such as Clean Energy which includes multiple companies involved in the global clean energy transition, all in a single investment.

Open a Stocks & Shares ISA in minutes, invest from £1, and manage everything right from our app. Just go to the ‘Invest’ tab to get started.

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¹ Financial Times

² Environmental Protection Agency

³ The Renewable Energy Institute

⁴ AL Circle

What is a pension? 

At its simplest, a pension is a long-term savings plan with special tax rules. Unlike a regular bank account, the government adds money to your pension in the form of tax relief, and your employer will often contribute too.

The money you save is invested, meaning it buys shares, bonds, and other assets to help it grow over time. The goal is to build up a large enough pot of money to provide you with an income when you retire.

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How do pensions work? 

Pension pots are built up through ‘compound growth’. You contribute a small amount regularly over many years, and that money earns a return. That return is then reinvested to earn its own return.

Money gets into your pension in one of three ways:

1. You pay in: Regular monthly payments or lump sums.
2. Your employer pays in: If you are employed, your company is usually legally required to contribute.
3. The government pays in: This is called tax relief, effectively ‘free money’ from the government to reward you for saving. We’ll come back to this later.

Read our full guide on pension contributions.

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Building your pension pot

What are the main types of pension? 

When building your retirement fund, almost every UK pension falls into one of two categories: Defined Contribution or Defined Benefit. 

Defined Contribution pension scheme 

Most modern private and workplace pensions are Defined Contribution schemes.

• You and/or your employer pay into a pot. That pot is invested.
• The final value of your pension depends on how much you paid in and how well your investments performed. This amount is not guaranteed.
• Examples: SIPPs, Nest, most workplace schemes.

Defined Benefit pension scheme

These are often called ‘final salary’ or ‘career average’ schemes. They are now rare in the private sector but common in the public sector (e.g., NHS, Teachers, Civil Service).

• Your employer promises to pay you a guaranteed income for life when you retire.
• The amount is based on your salary and years of service, not on investment performance. Your employer takes the risk, not you.

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Sources of pension income

What is the State Pension? 

The State Pension is a regular payment from the government, based on your National Insurance record, not your personal savings.

• Current amount (2025/26): The full New State Pension is £230.25 per week (approx. £11,973 a year).
• You usually need at least 10 ‘qualifying years’ on your National Insurance record to get anything, and 35 years to get the full amount.
• You can claim it when you reach State Pension age, which is currently 66. 

Read our full guide on the State Pension.

What is a workplace pension?  

A workplace pension is arranged by your employer. Thanks to Automatic Enrolment laws, employers must set up a pension for eligible staff and contribute towards it.

• Minimum contributions: Currently, the minimum total contribution is 8% of your qualifying earnings. 3% must come from your employer. 5% comes from you (including tax relief).
• If you opt out, you are essentially turning down a pay rise in the form of employer contributions.

Read our full guide on workplace pensions.

What is a private pension?  

A private pension (also known as a Personal Pension) is one you set up yourself. This is essential if you are self-employed or want to save extra money on top of your workplace scheme.

• SIPPs: A Self-Invested Personal Pension (SIPP) is a popular type of private pension that gives you full control over where your money is invested.
• Flexibility: You can usually stop, start, or change your contributions whenever you like.

Read our full guide on private pensions.

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An intro to pension tax rules

What is pension tax relief? 

Tax relief is how the government encourages you to save. It effectively refunds the Income Tax you paid on the money you put into your pension.

• Basic rate taxpayers (20%): To save £100, you only pay £80. The government adds the other £20.
• Higher and additional rate taxpayers (40-45%): You can claim back an additional 20-25%, meaning a £100 contribution effectively costs you only £55-60. The first 20% is typically paid out automatically into the pension and the additional 20-25% will need to be claimed through a Self Assessment tax return. 

What is the pension annual allowance? 

The amount you can save into a pension each year while still benefiting from tax relief is limited.

• The limit (2025/26 tax year): For most people, the Annual Allowance is £60,000 per tax year (or 100% of your earnings, whichever is lower).
• High earners: If you earn over £200,000, your allowance may be reduced (tapered).
• If you don't use your full allowance, you can often carry forward unused allowance from the previous three years.
• Once taxable income has been taken by an individual through flexible drawdown or the tax-free lump sum, tax relieved contributions to defined contribution pensions are limited to £10,000 per tax-year. This is the Money Purchase Annual Allowance (MPAA).

Read our full guide on pensions tax, relief and allowances.

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Understanding SIPPs

While workplace pensions are a great foundation, they often lack flexibility and investment choice.

A Self-Invested Personal Pension (SIPP) allows you to choose exactly where your pension is invested. Read our next guide to discover how SIPPs work and if one is right for you.

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How do bonds work?

When a government or company needs to raise money, it can issue a bond. As an investor, you lend them a set amount and they agree to pay you a fixed interest rate (called the coupon) every year e.g. 3%. 

After a set number of years (the term), they pay you back the £1,000. This is known as the bond lifecycle: 

1. Issuance – You buy the bond (or a fund that holds bonds). 

2. Interest payments – You receive regular income, typically annually or semi-annually. 

3. Maturity – At the end of the term, the bond is repaid in full. 

Bond prices can also rise and fall in value if traded on the secondary market. FDor example, if interest rates change or the issuer’s credit rating shifts.

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Types of bonds explained

Here are the main categories of bonds you’ll come across: 

• Government bonds (gilts) – Issued by the UK government. Generally considered very low risk, but with lower returns. 

• Corporate bonds – Issued by companies to raise funds. Riskier than gilts, but they usually offer higher interest. 

• Green bonds – Used to fund environmentally-friendly projects. Growing in popularity among ethical investors. 

• Index-linked bonds – Designed to keep pace with inflation, as the payments rise in line with a price index like the CPI. 

• In the US: Savings Bonds, which are government-issued and often used for long-term savings goals. These differ from UK bonds in structure and taxation, and are only available to US citizens.

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Why invest in bonds?

Bonds can play a key role in a well-rounded portfolio. Here’s why: 

1. Income generation – Regular interest payments can provide a steady stream of income. 

2. Capital preservation – Bonds tend to be more stable than stocks, so they can help protect your investment. 

3. Diversification – Adding bonds can smooth out the ups and downs of a stock-heavy portfolio. 

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Risks and disadvantages of bonds

Bonds are lower risk than stocks, but not risk-free. Here’s what to consider: 

• Credit risk – The issuer might fail to pay interest or repay the loan (this is rare with government bonds, more possible with corporate bonds). 

• Interest rate risk – If interest rates rise, existing bond prices can fall. Inflation risk – If inflation outpaces your bond’s return, your real purchasing power can shrink. 

• Liquidity risk – Some bonds can be harder to sell quickly without losing value, especially in a downturn.

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How to invest in bonds (UK)

There are a few ways to invest in bonds as a UK investor: 

1. Bond funds or ETFs – These are collections of bonds bundled together, offering easy access and instant diversification. 

2. Direct purchase – You can also buy individual gilts or corporate bonds through some investment platforms. 

3. Use tax-efficient wrappers – Investing through a Stocks & Shares ISA or a pension (not available with Chip) helps you keep more of your returns. 

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How do I invest in bonds? 

Start by choosing a platform, selecting a bond fund or individual bond, and deciding how much to invest. Funds and ETFs are often easier for beginners.

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Who should consider investing in bonds?

Bonds can suit a wide range of investors, including: 

• Investors approaching retirement – Looking for steady income and capital protection. ‍
• Cautious investors – Seeking lower volatility than stocks. ‍
• Income-seekers – Wanting predictable returns through interest payments. 

If you’re someone with a lower risk tolerance or nearing a major financial milestone, bonds can provide valuable balance in your investment mix.

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Common bond-related terms explained

• Yield – The return you earn from a bond, usually expressed as a percentage.‍
• Coupon – The interest payment a bond pays, often annually.‍
• Maturity – When the bond issuer repays the original amount borrowed.
• ‍Par value – The bond’s face value, typically £100 or £1,000.
• ‍Credit rating – An assessment of how risky a bond issuer is. Higher ratings mean lower risk.
• ‍Bearer bonds – Rare today, these are unregistered bonds where whoever holds the paper owns the bond.
• ‍Duration – A measure of a bond’s sensitivity to interest rate changes.
• ‍Callable bonds – Bonds the issuer can repay early, which can affect returns.

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Investment bonds summary

Bonds are a type of investment where you lend money to a government or company in exchange for interest payments. 

They’re generally lower risk than stocks, making them popular for income, stability, and diversification. While they come with their own risks, like interest rate changes or inflation, bonds can play a key role in your long-term financial plan.

In our next guide, we’ll cover exchange-traded funds (ETFs), what they are, how they work, and why they’re one of the most popular investment choices for both beginners and seasoned investors. 

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FAQs

What are bonds in simple terms? 

Bonds are loans you give to a government or company. In return, they pay you regular interest and repay your money after a set time.

Are bonds a good way to invest? 

Yes, especially if you're looking for stability and income. They may not grow as fast as stocks, but they’re generally lower risk.

How do beginners invest in bonds? 

The easiest way is through bond funds or ETFs on an investment platform. You can also use a Stocks & Shares ISA to invest tax-free.

What are the disadvantages of bonds? 

Bonds carry risks like interest rate changes, inflation, and defaults. Some can also be harder to sell quickly if you need access to your money.

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Pension death benefit rules  

The tax rules for passing on a pension depend almost entirely on the age at which you die.

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Before age 75

If you die before age 75, your remaining pension pot can usually be passed to your beneficiaries tax-free.

• Beneficiaries can usually choose to take the money as a single lump sum or as a flexible income stream.
• Currently they won’t pay Income Tax on the money they withdraw, regardless of earnings.

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After age 75

If you die after age 75, your pension can still be passed on, but it is no longer tax-free.

• Your beneficiaries will pay Income Tax on any money they withdraw.
• This money is included in your beneficiaries earnings for the year and taxed at their marginal rate.

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Pension death benefit 2 year rule 

The ‘2-year rule’ states that for death benefits to be paid tax-free (when dying before 75), the pension provider must pay the funds (or designate them to a beneficiary’s drawdown account) within two years of being notified of the death.

If the provider takes longer than two years to settle the funds, the money becomes taxable even if you died before age 75. 

Important to note:

• Beneficiaries should notify the provider promptly of the death to preserve the tax-free status of pots (where death was before 75). 
• Tax-free lump sums are limited by the Lump Sum and Death Benefit Allowance (LSDBA) of £1,073,100. This is a limit on the total tax-free lump sums paid out across life AND death. 

If a spouse, civil or cohabiting partner passes away, separate Bereavement Support Payments are available, provided the bereaved meets certain eligibility criteria.

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Pension beneficiaries  

Because pensions are held in a trust, the pension provider’s trustees have the final legal say on who receives the money. They are not legally bound by your Will.

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Expression of wish form  

An Expression of Wish (or Nomination of Beneficiaries) form is a document that tells your pension provider who you would like to receive your pension when you die.

• While the provider’s trustees ultimately have discretion, they will almost always follow your latest Expression of Wish.
• If you forget to update this form, for example, following a marriage or divorce, the trustees may pay this money to an ex-partner, as that is the last instruction they have on file.

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Rules for defined contribution pensions

Defined contribution pensions (like SIPPs and workplace pots) are the easiest to pass on.

• Your remaining pot is fully inheritable. 
• This money can be passed on multiple times, for example, to a spouse and then if any is left when they die, onto children.

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Rules for defined benefit pensions

Defined benefit (or final salary) schemes are less flexible. Because there is no ‘pot’ of cash, you cannot usually pass a lump sum to children.

• Most schemes will pay a reduced income (often 50%) to a surviving spouse or civil partner for the rest of their life.
• Some schemes pay an income to children if they are under 18 (or 23 if in full-time education).
• Once your spouse dies and children grow up, the pension payments usually stop completely.

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Changes to inheritance tax on pensions (April 2027)

Historically, pension pots have been exempt from Inheritance Tax (IHT). This made them a popular way to pass wealth to family without hitting the IHT threshold.

However, the government has announced that from April 2027, unused pension funds and death benefits will be included in the value of a deceased person’s estate for Inheritance Tax purposes.

• What’s changing? Your remaining pension savings will be added to the value of your other assets (like property and non-pension savings) when calculating if your estate owes Inheritance Tax.‍
• What could be owed? If your total estate, now including your pension, exceeds your tax-free allowances, the estate may be liable for Inheritance Tax at 40% on the excess.

You can find regulated and impartial advisers through the MoneyHelper website. Or, if you’re over 50 with a defined contribution pension you can get free and impartial guidance through Pension Wise.

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Interest rates and inflation are closely linked in the UK economy. Inflation, measured by the Consumer Price Index (CPI) and the Retail Price Index (RPI), is the rate at which the prices of services and goods are rising.

The Bank of England (BoE) is responsible for setting the base rate to help control inflation and maintain price stability.

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What Causes Inflation?

When the BoE raises interest rates, borrowing becomes more expensive. This can slow down economic growth and curb inflation. This is because higher interest rates make it more expensive for businesses to borrow money, which leads to slower growth and fewer job opportunities. 

Consumers also have less money to spend because they are paying more interest on loans and mortgages. As a result, demand for goods and services decreases, which can lead to lower prices.

On the other hand, when the BoE lowers interest rates, borrowing becomes cheaper. This can help stimulate economic growth and fuel inflation. When interest rates become lower, it makes it cheaper for businesses to borrow money, which can lead to more investment and create more jobs. 

Consumers also have more money to spend because they are paying less on loans and mortgages. This means the demand for goods and services increases, which can lead to higher prices. 

Learn more about interest rates here.

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How Does the Bank of England Control Inflation and Interest Rates?

The Bank of England uses monetary policy to control inflation and interest rates. The bank sets interest rates, which influence the cost of borrowing and the rate of growth in the money supply.

• When inflation is too high, the bank raises interest rates to reduce spending and slow down the economy.
• When inflation is too low, the bank lowers interest rates to encourage spending and growth.

The bank also uses other tools, such as quantitative easing, to influence the money supply and control inflation.

Quantitative easing (QE) is a monetary policy used by central banks to stimulate the economy by increasing the money supply and lowering interest rates.

This is typically done by purchasing government bonds or other financial assets from banks, which increases the banks' reserves and makes it easier for them to lend money.

The goal of QE is to encourage spending and investment, which can help boost economic growth and reduce unemployment.

This can help to stimulate economic growth and curb inflation by making it cheaper for businesses and consumers to borrow money.

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What You Need To Remember

When interest rates are high, borrowing becomes more expensive and can slow down economic growth whilst curbing inflation. When interest rates are low, borrowing becomes cheaper and can stimulate economic growth. 

Learn more about how our instant access savings account.

What is growth investing?

Growth investing targets companies that investors believe have the potential to grow faster than the broader market. 

These are often newer companies or those operating in rapidly expanding industries like technology, renewable energy, or healthcare innovation.

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Key characteristics of growth investing

• Emphasis on capital appreciation over income (e.g. dividends).
• Companies often reinvest profits to fuel future growth.
• Share prices tend to be more volatile but can offer higher returns over time.
• Commonly priced higher relative to earnings (higher P/E ratios).

Growth investing is typically more suitable for investors with a longer time horizon and a higher risk tolerance, as the payoff often comes from future potential rather than current earnings.

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What is value investing?

Value investing involves identifying companies that appear to be undervalued by the market. 

These are stocks trading below their intrinsic value based on fundamental analysis (like cash flow, earnings, or book value).

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Key characteristics of value investing

• Focus on finding stocks perceived as mispriced.
• Often includes established companies with stable earnings.
• Generally provides dividend income as well as capital growth.
• Less volatility, but potentially slower returns.

This strategy may appeal to more conservative investors looking for steady returns and lower downside risk.

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Examples of Growth and Value Investing

To better understand how these strategies play out in practice, consider how growth and value investors might view the same market differently.

Growth

• A growth investor may be drawn to a fast-growing technology firm that has yet to post consistent profits but is expanding rapidly, reinvesting all earnings into product development and market share. 
• Despite a high valuation relative to current earnings, the investor believes the company’s future potential justifies the price. Sectors like software, green energy, or healthcare innovation often fall into this category.

Value

• In contrast, a value investor might look for a well-established consumer goods company with stable earnings, consistent dividend payouts, and a share price that appears low relative to its earnings or book value. 
• The belief is that the market has temporarily mispriced the company, possibly due to short-term concerns, and that the share price will eventually recover as fundamentals prevail.

Both strategies can be applied using individual stock selection or through diversified investment funds, which pool companies with similar characteristics. 

Many UK investors use index funds or ETFs tailored to either value or growth styles as a simple way to gain exposure while mitigating individual stock risk.

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The Key Differences Between Value and Growth Investing

While both growth and value investing aim to build long-term wealth, they differ in philosophy, risk profile, and timing.

Growth investing is forward-looking. It relies on the market eventually rewarding companies for their innovation and rapid expansion. This often means accepting higher volatility and short-term uncertainty in exchange for the potential of above-average returns.

Value investing, on the other hand, is based on the premise that markets can misjudge a company's worth. By purchasing undervalued companies with strong fundamentals, value investors aim to benefit as the market corrects itself. 

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How to Decide if Value or Growth Investing Is Right for You

Choosing between growth and value investing depends on several personal factors:

• Investment goals: Are you aiming for long-term capital appreciation, or are you seeking steady income and lower volatility?
• Time horizon: Growth investing usually requires a longer time frame to ride out market swings. Value investing may suit those with a medium to long-term horizon looking for more stable returns.
• Risk tolerance: If you're comfortable with market fluctuations and are focused on potential gains, growth may appeal to you. If you prefer less risk and more predictability, value could be a better fit.
• Behavioural tendencies: Some investors struggle with holding onto volatile growth stocks through downturns. Understanding your emotional response to risk is just as important as the numbers.

In reality, many investors find a blend of both strategies provides balance, with growth driving long-term returns and value offering stability.

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Growth and value investing summary

Understanding the core principles of growth and value investing helps lay the foundation for a more thought out and tailored investment strategy. 

While growth investing seeks to capitalise on future potential, value investing focuses on capitalising on perceived mispricings today. Each has its strengths and trade-offs.

By aligning your personal goals, risk tolerance, and time horizon with the appropriate strategy, or combination, you can build a more resilient investment portfolio.

In the next guide, we’ll explore how you can begin to put these strategies into practice through building passive income, a key step in creating financial freedom and long-term wealth.

What are the biggest companies in Europe by market cap?

This list ranks Europe’s biggest public companies by market capitalisation: the cumulative value of a company's total outstanding market shares. We’ll also be highlighting other key figures, such as the company's revenue, gross profit, and 1-year return (all based on the previous fiscal year). 

Some other key facts such as the exchange the company is listed on, the founding year and country the company is headquartered in are also covered.

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1. SAP SE

• Market cap: $317.7 billion
• ‍Revenue: $37.56 billion
• ‍Gross profit: $26.98 billion
• ‍1-yr return: +20.62%
• ‍Exchange: XETR
• ‍Year founded: 1972
• ‍Country: Germany

SAP is a global leader in enterprise application software. Its systems are a cornerstone of modern business operations.

• Cloud & software: Provides cloud-based solutions and traditional software for managing business operations and customer relations, including ERP (Enterprise Resource Planning).
• Services: Offers expert support, implementation services, and training to help customers maximize the value of their SAP applications.

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2. LVMH Moët Hennessy Louis Vuitton

• Market cap: $292.83 billion‍
• Revenue: $94.62 billion‍
• Gross profit: $65.34 billion‍
• 1-yr return: -21.76%‍
• Exchange: EURONEXT‍
• Year founded: 1987‍
• Country: France

LVMH is the world's largest luxury goods conglomerate, managing a diverse portfolio of prestigious brands.

• Fashion & leather goods: The largest division, featuring iconic brands like Louis Vuitton, Christian Dior, and Fendi.
• Wines & spirits: Owns world-renowned champagne and cognac houses such as Moët & Chandon, Hennessy, and Dom Pérignon.
• Watches, jewellery, & retail: Includes brands like Tiffany & Co., Bulgari, and TAG Heuer, alongside selective retailers like Sephora.

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3. ASML Holding N.V.

• Market cap: $286.99 billion‍
• Revenue: $30.13 billion‍
• Gross profit: $15.48 billion‍
• 1-yr return: -13.77%‍
• Exchange: EURONEXT‍
• Year founded: 1984‍
• Country: Netherlands

ASML is a critical player in the semiconductor industry, holding a near-monopoly on the production of extreme ultraviolet (EUV) lithography machines.

• Lithography systems: Designs and manufactures the complex machines that chipmakers like TSMC, Samsung, and Intel use to create the circuitry on microchips. These systems are essential for producing the most advanced processors in the world.

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4. Roche Holding AG

• Market cap: $259.40 billion‍
• Revenue: $66.27 billion‍
• Gross profit: $46.06 billion‍
• 1-yr return: -3.58%‍
• Exchange: SIX‍
• Year founded: 1896‍
• Country: Switzerland

Roche is a global pioneer in pharmaceuticals and diagnostics, focusing on advancing science to improve people's lives.

• Pharmaceuticals: A world leader in oncology (cancer treatments) and also develops medicines for immunology, ophthalmology, and infectious diseases.
• Diagnostics: Provides a wide range of innovative diagnostic tests and systems that help doctors detect, diagnose, and monitor diseases.

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5. Novo Nordisk A/S

• Market cap: $252.19 billion‍
• Revenue: $36.70 billion‍
• Gross profit: $30.87 billion‍
• 1-yr return: -60.12%‍
• Exchange: OMXCOP‍
• Year founded: 1923‍
• Country: Denmark

Novo Nordisk is a global healthcare company with a primary focus on treating chronic diseases, particularly diabetes.

• Diabetes & obesity care: The world's leading supplier of insulin and has seen massive growth from its highly effective GLP-1 treatments for diabetes and weight loss, such as Ozempic and Wegovy.
• Rare diseases: Develops and markets biopharmaceutical products for treating hemophilia and other rare blood and endocrine disorders.

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6. Hermès International SCA 

• Market cap: $251.24 billion‍
• Revenue: $14.86 billion‍
• Gross profit: $10.45 billion‍
• 1-yr return: -21.56%‍
• Exchange: EURONEXT‍
• Year founded: 1837‍
• Country: France

Hermès is an icon of high-end luxury, renowned for its exceptional craftsmanship, exclusivity, and timeless designs.

• Leather goods & saddlery: The core of its business, famous for its highly sought-after Birkin and Kelly handbags.
• Other categories: Produces a wide range of luxury goods, including silk scarves, ties, ready-to-wear fashion, perfumes, and watches.

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7. AstraZeneca PLC

• Market cap: $245.98 billion‍
• Revenue: $47.92 billion‍
• Gross profit: $39.42 billion‍
• 1-yr return: -5.88%‍
• Exchange: London Stock Exchange‍
• Year founded: 1913‍
• Country: United Kingdom

AstraZeneca is a global, science-led biopharmaceutical company with a focus on creating innovative prescription medicines.

• Oncology: A world leader in cancer treatments, which forms a significant and growing part of its revenue.
• Biopharmaceuticals: Develops medicines for major disease areas like cardiovascular, respiratory, and immunology.

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8. L'Oréal S.A.

• Market cap: $244.94 billion‍
• Revenue: $45.93 billion‍
• Gross profit: $33.72 billion‍
• 1-yr return: +3.01%‍
• Exchange: EURONEXT‍
• Year founded: 1909‍
• Country: France

L'Oréal is the world's largest cosmetics and beauty company, with a vast portfolio of brands covering all segments of the market.

• Consumer products: Mass-market brands like Maybelline, Garnier, and L'Oréal Paris.
• Luxe: High-end brands including Lancôme, Kiehl's, and Yves Saint Laurent Beauté.
• Active cosmetics: Dermatological skincare brands such as La Roche-Posay and CeraVe.
• Professional products: Supplies hair salons with brands like Kérastase and Redken.

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9. Novartis AG

• Market cap: $240.15 billion‍
• Revenue: $50.31 billion‍
• Gross profit: $37.89 billion‍
• 1-yr return: +3.91%‍
• Exchange: SIX‍
• Year founded: 1996‍
• Country: Switzerland

Novartis is a global healthcare company that provides solutions to address the evolving needs of patients worldwide.

• Innovative medicines: Focuses on developing and marketing patented prescription drugs across various therapeutic areas, including cardiovascular, immunology, and neuroscience.
• Sandoz (generic & biosimilars): Operates a major division that produces generic pharmaceuticals and biosimilars after patents on original drugs have expired.

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10. Nestlé S.A.

• Market cap: $237.10 billion‍
• Revenue: $105.13 billion‍
• Gross profit: $49.52 billion‍
• 1-yr return: -16.87%‍
• Exchange: SIX‍
• Year founded: 1866‍
• Country: Switzerland

Nestlé is the largest food and beverage company in the world, with a massive portfolio of well-known brands.

• Powdered & liquid beverages: Includes major coffee brands like Nescafé, Nespresso, and Starbucks (packaged).
• PetCare: A global leader with brands such as Purina, Friskies, and Fancy Feast.
• Nutrition & health science: Produces infant formulas, health supplements, and medical nutrition.
• Confectionery & packaged food: Owns iconic brands like KitKat, Maggi, and Toll House.

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What are the biggest companies by total annual revenue?

• Volkswagen Group: $305.98 billion 
• Shell: $265.74 billion 
• TotalEnergies: $208.61 billion 
• Mercedes-Benz Group: $166.70 billion 
• Uniper SE: $121.36 billion

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What are the biggest companies by workforce?

• Volkswagen Group: 684,013 
• DHL Group: 594,439 
• Schwarz Gruppe: 575,000 
• Compass Group: 550,000 
• Tesco: 337,255

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Summary

Understanding a company's performance is crucial; it's how you truly know what you own. These metrics directly drive the value of your stocks and funds. When you understand these key drivers, you can navigate market changes with confidence, rather than just reacting to headlines.

Next we’ll be looking at the biggest companies in China by market cap.

All market data sourced from TradingView and company reports as of 04.09.2025.

What Is buy and hold?

Buy and hold is a passive investment strategy. It involves purchasing an investment and holding it over the long term, often years or decades, with minimal trading. 

The rationale is based on historical data showing that markets tend to rise over time despite short-term volatility.

Rather than reacting to daily market news or price swings, buy and hold investors focus on the long-term potential of their investments, allowing compounding returns and capital appreciation to work in their favour.

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Advantages of a buy and hold strategy

• Compounding Returns: Over time, reinvested dividends and interest can significantly increase the total value of an investment.
• Lower Costs: Because it involves less buying and selling, this strategy reduces trading fees and potentially lowers capital gains tax liabilities in taxable accounts.
• Less Emotional Investing: A long-term view helps investors avoid reactive decision making in response to market dips or economic news.
• Tax Efficiency: In the UK, assets held longer than a year may be subject to more favourable capital gains treatment, especially when held within tax-efficient wrappers such as ssISAs or pensions.

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Risks of a buy and hold strategy

While buy and hold is relatively simple and historically effective, it’s not without risk:

• Market Downturns: Bad market days can still negatively affect portfolio values, particularly if they occur near an investor's time of withdrawal.
• Company or Sector Risk: Holding individual stocks over long periods can expose you to company-specific risks such as poor management or disruptive competition.
• Inflation Risk: Over decades, inflation can erode real returns if your investments don’t grow faster than inflation.
• Behavioural Risk: The strategy requires patience and discipline, emotional decisions can undermine its effectiveness.

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How to build a buy and hold strategy

1. Set Clear Objectives

Determine your financial goals, risk tolerance, and time horizon. Buy and hold works best with long-term objectives such as retirement planning.

2. Choose a Diversified Portfolio

Instead of focusing on single shares, many investors use diversified instruments like index funds or ETFs to spread risk across different sectors or markets.

3. Use Tax-Efficient Accounts

In the UK, Stocks and Shares ISAs or Self-Invested Personal Pensions (SIPPs) allow your investments to grow free from Capital Gains Tax and dividend income won’t count towards your Personal Allowance.

4. Automate Where Possible

Regularly investing a fixed amount (pound-cost averaging) can smooth out market volatility over time and build a habit of disciplined investing.

5. Review, But Don’t Overreact

Check and manage your portfolio annually or after major life changes, but avoid frequent trading. Adjust only if your goals or circumstances change.

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Buy and hold strategy summary

The buy and hold strategy is a cornerstone of long-term investing. Its simplicity and historical success make it especially appealing for new investors looking to build wealth over time.

While not without risks, its disciplined, passive nature aligns well with long-term financial goals.

In the next guide, we’ll compare two distinct investing styles: defensive and aggressive strategies, helping you understand how different approaches to risk and return can shape your investment journey.