SMAUG is a “pseudonym—the past tense of the primitive Germanic verb Smugan, to squeeze through a hole: a low philological jest” , referring to the passage in The Hobbit in which the company is looking at the map of the Mountain, and Gandalf explains that Smaug could not possibly have used the hidden passage to the lower halls, “because it is too small.”
ORC: The bogeyman of Tolkiens tales, actually derived from Old English orc 'demon', but only because of its phonetic suitability...'
SMEAGOL: Tolkien gave the Old English word smygel, meaning "burrow", related to the fact Smeagol was always looking into holes and burrows
GANDALF: The Old Norse name Gandalfr incorporates the words gandr meaning "wand", "staff" or (especially in compounds) "magic" and álfr "elf". The name Gandalf is found in at least one more place in Norse myth.
(source:
http://middleearthblog.blogspot.ro/2012 ... names.html)