Compound words are formed by joining two or more simple words. Examples are: moonlight, nevertheless and undertake.
The meaning of a compound is not always predictable from the meanings of its component parts. For example, not every friend who is a boy is your boyfriend. The formation of a compound is called compounding.

Most compound words are nouns, adjectives and verbs.

Formation of compound words

The compound words may be formed from:

Noun + noun

Examples are: moonlight, postman, railway, airman, manservant, shoemaker, ringleader, windmill, haystack and screwdriver.

Adjective + noun

Examples are: sweetheart, shorthand, blackboard, nobleman, stronghold etc.

Verb + noun

Examples are: spendthrift, makeshift, breakfast, daredevil, hangman, pickpocket etc.

Gerund + noun

Drawing-room, looking-glass, writing-desk, blotting paper, walking stick, stepping-stone etc.

Adverb (or preposition) + noun

Outlaw, afterthought, foresight, forethought, overcoat, downfall, bypass, afternoon, inside, inmate etc.

Verb + adverb

Drawback, look-up, go-between, send-off, die-hard

Adverb + verb

Examples are: outset, outcry, income, outcome etc.

Notes
In most compound words, it is the first word which modifies the meaning of the second. When the two elements of the compound are only partially blended, a hyphen is put between them.