Tell me about gearing, Moneybox Man. I'm fine with the NAV. My own personal NAV is so high I'm in the stratosphere. But gearing and TERs really muddle me up. Gearing always seems to be higher than 100, which can't be right. Miss Muddled, Middlesex.

I'm glad you asked me that, Miss Muddled Middlesex. Gearing and the TER are the last two things we need to look at when considering investment trusts.

• Gearing is when investment trusts borrow cash from the bank, and use it to buy shares. A trust with a gearing score of 100 is, in fact, not geared at all. A gearing of 110 means that the trust has borrowings of 10% over and above its normal value. Gearing allows the managers to - well, manage, to show their flair, win a bit extra for the NAV or lose a bit if they back the wrong horse. Trusts with high gearing are more volatile. If the market goes up, the shares go up a bit extra - if the markets fall, the shares fall a bit further. Temple Bar is geared to 116, and the Edinburgh Trust to 126. 

• TER is a trust's Total Expenses Ratio. Investment Trusts have lower running costs than "unit trust" funds because they don't pay financial advisers and don't advertise much. But costs are sometimes complex, involving lump sum payments and percentages, and payments to directors. The TER is a measure favoured by the noble and upstanding Association of Investment Companies. It shows the effect of the real costs - manager's costs, other running costs - on the fund's performance.

•  You can see the TERs and the gearing for many trusts at the AIC website