Professional Documents
Culture Documents
The following is a glossary of investment terms that will help you study for
the CSC examination and increase your overall knowledge of the investment
industry. Some of the terms also have a general meaning, but only their specialized
investment industry meaning is given here. Words in bold face type within
definitions have their own glossary definitions. Note that this list is not complete:
it should be used in conjunction with your own definitions of terms compiled
during your studies.
Glossary
Accredited Investor Agent Annual Information Form (AIF)
An individual or institutional investor who An investment dealer operates as an agent A document in which an issuer is required
meets certain minimum requirement when it acts on behalf of a buyer or a seller to disclose information about presently
relating to income, net worth, or investment of a security and does not itself own title to known trends, commitments, events or
knowledge. Also referred to as a the securities at any time during the uncertainties that are reasonably expected
sophisticated investor. transactions. See also Principal. to have a material impact on the issuers
business, financial condition or results of
Accrued Interest Algorithmic Trading operations. Although investors are typically
Interest accumulated on a bond or The use of sophisticated mathematical not provided with the AIF, the prospectus
debenture since the last interest payment algorithms to execute equity trades over must state that it is available on request.
date. electronic trading systems.
Annual Report
Adjusted Cost Base All or None Order (AON) The formal financial statements and report
The deemed cost of an asset representing An order that must be executed in its on operations issued by a company to its
the sum of the amount originally paid plus entirety partial fills will not be accepted. shareholders after its fiscal year-end.
any additional costs, such as brokerage fees
and commissions. Allocation Annuitant
The administrative procedure by which Person on whose life the maturity and
Advance-Decline Line income generated by the segregated funds death benefit guarantees are based. It can be
A tool used in technical analysis to measure investment portfolio is flowed through to the contract holder or someone else
the breadth of the market. The analyst the individual contract holders of the fund. designated by the contract holder. In
takes difference between the number of registered plans, the annuitant and
stocks that increased in value each day less Alpha
A statistical measure of the value a fund contract holder must be the same person.
the number that have decreased.
manager adds to the performance of the Annuity
After Acquired Clause fund managed. If alpha is positive, the A contract usually sold by life insurance
A protective clause found in a bonds manager has added value to the portfolio. If companies that guarantees an income to
indenture or contract that binds the bond the alpha is negative, the manager has the beneficiary or annuitant at some time
issuer to pledging all subsequently purchased underperformed the market. in the future. The income stream can be
assets as part of the collateral for a bond very flexible. The original purchase price
issue. Alternative Trading Systems (ATS)
Privately-owned computerized networks may be either a lump sum or a stream of
After Market Stabilization that match orders for securities outside of payments. See Deferred Annuity and
A type of arrangement where the dealer recognized exchange facilities. Also referred Immediate Annuity.
supports the offer price of a newly issued to as Proprietary Electronic Trading Any Part Order
stock once it begins trading in the Systems (PETS). A type of order in which the client will
secondary market. accept all stock in odd, broken or standard
American-Style Option
Agency Traders An option that can be exercised at any time trading units up to the full amount of the
Manage trades for institutional clients. during the options lifetime. See also order.
They do not trade the dealer members European-Style Option. Arbitrage
capital, and they trade only when acting on The simultaneous purchase of a security on
behalf of clients. Agency traders do not Amortization
Gradually writing off the value of an one stock exchange and the sale of the same
merely take orders; they must manage security on another exchange at prices which
institutional orders with minimal market intangible asset over a period of time.
Commonly applied to items such as yield a profit to the arbitrageur.
impact and act as the clients eyes and ears
for relevant market intelligence. goodwill, improvements to leased Arbitration
premises, or expenses of a new stock or A method of dispute resolution in which an
bond issue. See also Depreciation. independent arbitrator is chosen to assist
aggrieved parties recover damages.
assets. Issue terms range from less than Consumer Price Index (CPI) negative than it will fall in price if the yield
three months to one year. Most corporate Price index which measures the cost of change is positive.
paper trades in $1,000 multiples, with a living by measuring the prices of a given
minimum initial investment of $25,000. basket of goods. The CPI is often used as Corporate Note
Commercial paper may be bought and sold an indicator of inflation. An unsecured promise made by the
in a secondary market before maturity at borrower to pay interest and repay the
Continuation Pattern principal at a specific date.
prevailing market rates.
A chart formation indicating that the
Commission current trend will continue. Corporation or Company
The fee charged by a stockbroker for buying A form of business organization created
Continuous Disclosure under provincial or federal statutes which
or selling securities as agent on behalf of a
In Ontario, a reporting issuer must issue a has a legal identity separate from its
client.
press release as soon as a material change owners. The corporations owners
Commodity occurs in its affairs and, in any event, (shareholders) have no personal liability for
A product used for commerce that is traded within ten days. See also Timely its debts. See also Limited Liability.
on an organized exchange. A commodity Disclosure.
could be an agricultural product such as Correction
Contract Holder A price reversal that typically occurs when a
canola or wheat, or a natural resource such
The owner of a segregated fund contract. security has been overbought or oversold in
as oil or gold. A commodity can be the
basis for a futures contract. the market.
Contraction
Represents a downturn in the economy and Correlation
Common Stock
can lead to a recession if prolonged. A measure of the relationship between two
Securities representing ownership in a
company. They carry voting privileges and or more securities. If two securities mirror
Contributions in Kind
are entitled to the receipt of dividends, if each others movements perfectly, they are
Transferring securities into an RRSP. The
declared. Also called common shares. said to have a positive one (+1) correlation.
general rules are that when an asset is
Combining securities with high positive
transferred there is a deemed disposition.
Competitive Tender correlations does not reduce the risk of a
Any capital gain would be reported and
A distribution method used in particular by portfolio. Combining securities that move
taxes paid. Any capital losses that result
the Bank of Canada in distributing new in the exact opposite direction from each
cannot be claimed.
issues of government marketable bonds. other are said to have perfect negative one
Bids are requested from primary Conversion Price (-1) correlation. Combining two securities
distributors and the higher bids are The dollar value at which a convertible with perfect negative correlation reduces
awarded the securities for distribution. See bond or security can be converted into risk. Very few, if any, securities have a
also Non-Competitive Tender. common stock. perfect negative correlation. However, risk
in a portfolio can be reduced if the
Compound Interest Conversion Privilege combined securities have low positive
Interest earned on an investment at periodic The right to exchange a bond for common correlations.
intervals and added to the amount of the shares on specifically determined terms.
investment; future interest payments are Cost Accounting Method
then calculated and paid at the original rate Convertible Used when a company owns less than 20%
but on the increased total of the investment. A bond, debenture or preferred share of a subsidiary.
In simple terms, interest paid on interest. which may be exchanged by the owner,
usually for the common stock of the same Cost of Sales
Confirmation company, in accordance with the terms of A statement of comprehensive income
A printed acknowledgement giving details the conversion privilege. A company can account representing the cost of buying raw
of a purchase or sale of a security which is force conversion by calling in such shares materials that go directly into producing
normally mailed to a client by the broker or for redemption if the redemption price is finished goods.
investment dealer within 24 hours of an below the market price.
order being executed. Also called a Cost-Push Inflation
contract. Convertible Arbitrage A type of inflation that develops due to an
A strategy that looks for mispricing increase in the costs of production. For
Consolidated Financial Statements between a convertible security and the example, an increase in the price of oil may
A combination of the financial statements underlying stock. A typical convertible contribute to higher input costs for a
of a parent company and its subsidiaries, arbitrage position is to be long the company and could lead to higher
presenting the financial position of the convertible bond and short the common inflation.
group as a whole. stock of the same company.
Coupon Rate
Consolidation Convexity The rate of interest that appears on the
See Reverse Split. A measure of the rate of change in duration certificate of a bond. Multiplying the
over changes in yields. Typically, a bond coupon rate times the principal tells the
will rise in price more if the yield change is holder the dollar amount of interest to be
paid by the issuer until maturity. For and must be paid before any dividends may off workers in response to lower sales. It
example, a bond with a principal of be paid on the companys common shares. drops when the economy strengthens again.
$1,000 and a coupon of 10% would pay
$100 in interest each year. Coupon rates Current Account Dark Pool
remain fixed throughout the term of the Account that reflects all payments between An equity marketplace that does not offer
bond. See also Yield. Canadians and foreigners for goods, services, pre-trade transparency on trader orders.
interest and dividends. Along with the
Covenant capital and financial account it is a Day Order
A pledge in a bond indenture indicating component of the balance of payments. A buy or sell order that automatically expires
the fulfilment of a promise or agreement by if it is not executed on the day it is entered.
the company issuing the debt. An example Current Assets All orders are day orders unless otherwise
of a covenant may include the promise not Cash and assets which in the normal course specified.
to issue any more debt. of business would be converted into cash,
usually within a year, e.g. accounts Dealer Market
Cover receivable, inventories. A statement of A market in which securities are bought
Buying a security previously sold short. See financial position category. and sold over-the-counter in which dealers
also Short Sale. acts as principals when buying and selling
Current Liabilities securities for clients. Also referred to as the
Coverage Trader Money owed and due to be paid within a unlisted market.
Manages trades on behalf of institutional year, e.g. accounts payable. A statement of
clients and does not trade the dealer financial position category. Dealer Member
members capital. Also known as an agency A stock brokerage firm or investment dealer
trader. Current Ratio which is a member of a stock exchange or
A liquidity ratio that shows a companys the Investment Industry Regulatory
Covered Writer ability to pay its current obligations from Organization of Canada.
The writer of an option who also holds a current assets. A current ratio of 2:1 is the
position that is equivalent to, but on the generally accepted standard. See also Quick Dealers Spread
opposite side of the market from the short Ratio. The difference between the bid and ask
option position. In some circumstances, the prices on a security.
equivalent position may be in cash, a Current Yield
The annual income from an investment Death Benefit
convertible security or the underlying The amount that a segregated fund policy
security itself. See also Naked Writer. expressed as a percentage of the
investments current value. On stock, pays to the beneficiary or the estate when
Creation Unit calculated by dividing yearly dividend by the market value of the segregated fund is
The block of ETF shares provided by an market price; on bonds, by dividing the lower than the guaranteed amount on the
ETF issuer to the market maker. coupon by market price. See also Yield. death of the annuitant.
Deemed Disposition amount attributed to that asset or liability For example, a call option on IBM is a
Under certain circumstances, taxation rules for income tax purposes. derivative because the value of the call
state that a transfer of property has occurred, varies in relation to the performance of
even without a purchase or sale, e.g., there Defined Benefit Plan IBM stock. See also Options.
is a deemed disposition on death or A type of registered pension plan in which
emigration from Canada. the annual payout is based on a formula. Direct Bonds
The plan pays a specific dollar amount at This term is used to describe bonds issued
Default retirement using a predetermined formula. by governments that are firsthand
A bond is in default when the borrower has obligations of the government itself. See
failed to live up to its obligations under the Defined Contribution Plan also Guaranteed Bonds.
trust deed with regard to interest, sinking A type of registered pension plan where the
fund payments or has failed to redeem the amount contributed is known but the dollar Direct Electronic Access (DEA)
bonds at maturity. amount of the pension to be received is The process of some institutional clients
unknown. Also known as a money directly accessing the exchanges
Default Risk purchase plan. electronically via their investment dealers
The risk that a debt security issuer will be rather than placing orders (usually verbally)
unable to pay interest on the prescribed Delayed Floater with their investment dealer who would in
date or the principal at maturity. Default A type of variable rate preferred share turn execute the transaction.
risk applies to debt securities not equities that entitles the holder to a fixed dividend
since equity dividend payments are not for a predetermined period of time after Directional Hedge Funds
contractual. which the dividend becomes variable. Also A type of hedge fund that places a bet on
known as a fixed-reset or fixed floater. the anticipated movements in the market
Defensive Stock prices of equities, fixed-income securities,
A stock of a company with a record of Delayed Opening foreign currencies and commodities.
stable earnings and continuous dividend Postponement in the opening of trading of
payments and which has demonstrated a security the result of a heavy influx of buy Director
relative stability in poor economic and/or sell orders. Person elected by voting common
conditions. For example, utility stock shareholders at the annual meeting to
Delisting direct company policies.
values do not usually change from periods Removal of a securitys listing on a stock
of expansion to periods of recession since exchange. Directors Circular
most individuals use a constant amount of Information sent to shareholders by the
electricity. Demand Pull Inflation directors of a company that are the target
A type of inflation that develops when of a takeover bid. A recommendation to
Deferred Annuity continued consumer demand pushes prices
This type of contract, usually sold by life accept or reject the bid, and reasons for this
higher. recommendation, must be included.
insurance companies, pays a regular stream
of income to the beneficiary or annuitant Depletion Disclosure
at some agreed-upon start date in the future. Refers to consumption of natural resources One of the principles of securities regulation
The original payment is usually a stream of that are part of a companys assets. in Canada. This principle entails full, true
payments made over time, ending prior to Producing oil, mining and gas companies and plain disclosure of all material facts
the beginning of the annuity payments. See deal in products that cannot be replenished necessary to make reasoned investment
also Annuity. and as such are known as wasting assets. decisions.
The recording of depletion is a
Deferred Preferred Shares bookkeeping entry similar to depreciation Discount
A type of preferred share that pays no and does not involve the expenditure of The amount by which a preferred stock or
dividend until a future maturity date. cash. bond sells below its par value.
Deferred Sales Charge Depreciation Discount Brokers
The fee charged by a mutual fund or Systematic charges against earnings to write Brokerage house that buys and sells
insurance company for redeeming units. It off the cost of an asset over its estimated securities for clients at a greater commission
is otherwise known as a redemption fee or useful life because of wear and tear through discount than full-service firms.
back-end load. These fees decline over use, action of the elements, or obsolescence.
time and are eventually reduced to zero if It is a bookkeeping entry and does not Discount Rate
the fund is held long enough. involve the expenditure of cash. In computing the value of a bond, the
discount rate is the interest rate used in
Deferred Tax Liabilities Derivative calculating the present value of future cash
The income tax payable in future periods. A type of financial instrument whose value flows.
These liabilities commonly result from is based on the performance of an
temporary differences between the book underlying financial asset, commodity, or
value of assets and liabilities as reported on other investment. Derivatives are available
the statement of financial position and the on interest rates, currency, stock indexes.
Emerging Industries Event-Driven Hedge Funds of the option who exercises his or her
Brand new industries in the early stages of A type of hedge fund that seeks to profit rights. See also Assignment.
growth. Often considered as speculative from unique events such as mergers,
because they are introducing new products acquisitions, stock splits or buybacks. Exercise Price
that may or may not be accepted and may The price at which a derivative can be
face strong competition from other new Ex-Ante exchanged for a share of the underlying
entrants. A projection of expected returns what security (also known as subscription price).
investors expect to realize as a return. For an option, it is the price at which the
Equilibrium Price underlying security can be purchased, in
The price at which the quantity demanded Exchange Fund Account
the case of a call, or sold, in the case of a
equals the quantity supplied. A special federal government account
put, by the option holder. Synonymous
operated by the Bank of Canada to hold
with strike price.
Equipment Trust Certificate and conduct transactions in Canadas
A type of debt security that was historically foreign exchange reserves on instructions Expansion
used to finance rolling stock or railway from the Minister of Finance. A phase of the business cycle characterized
boxcars. The cars were the collateral behind by increasing corporate profits and hence
the issue and when the issue was paid down Exchange Rate
increasing share prices, an increase in the
the cars reverted to the issuer. In recent The price at which one currency exchanges
demand for capital for business expansion,
times, equipment trusts are used as a for another.
and hence an increase in interest rates.
method of financing containers for the Exchange-Traded Funds (ETFs)
offshore industry. A security, more Expectations Theory
Open-ended mutual fund trusts that hold
common in the U.S. than in Canada. A theory stating that the yield curve is
the same stocks in the same proportion as
shaped by a market consensus about future
Equity those included in a specific stock index.
interest rates.
Ownership interest in a corporations stock Shares of an exchange-traded fund trade on
that represents a claim on its revenue and major stock exchanges. Like index mutual Expiration Date
assets. See also Stock. funds, ETFs are designed to mimic the The date on which certain rights or option
performance of a specified index by contracts cease to exist. For equity options,
Equity Accounting Method investing in the constituent companies this date is usually the Saturday following
An accounting method used to determine included in that index. Like the stocks in the third Friday of the month listed in the
income derived from a companys which they invest, shares can be traded contract. This term can also be used to
investment in another company over which throughout the trading day. describe the day on which warrants and
it exerts significant influence. rights cease to exist.
Exchange-Traded Notes (ETNs)
Escrowed Shares Exchange-traded debt obligations issued by Ex-Post
Outstanding shares of a company which, a bank that promises to pay investors a The rate of return that was actually
while entitled to vote and receive dividends, return on their investment based on the received. This historic data is used to
may not be bought or sold unless special performance of a specific reference asset measure actual performance.
approval is obtained. Mining and oil such as an index or another benchmark.
companies commonly use this technique Ex-Rights
when treasury shares are issued for new Ex-Dividend A term that denotes that the purchaser of a
properties. Shares can be released from A term that denotes that when a person common share would not be entitled to a
escrow (i.e., freed to be bought and sold) purchases a common or preferred share, rights offering. Common shares go
only with the permission of applicable they are not entitled to the dividend ex-rights two business days prior to the
authorities such as a stock exchange and/or payment. Shares go ex-dividend two shareholder of record date.
securities commission. business days prior to the shareholder
record date. See also Cum Dividend. Extendible Bond or Debenture
Eurobonds A bond or debenture with terms granting
Bonds that are issued and sold outside a Exempt List the holder the option to extend the maturity
domestic market and typically Large professional buyers of securities, date by a specified number of years.
denominated in a currency other than that mostly financial institutions, that are
offered a portion of a new issue by one Extension Date
of the domestic market. For example, a For extendible bonds the maturity date of
bond denominated in Canadian dollars member of the banking group on behalf of
the whole syndicate. The term exempt the bond can be extended so that the bond
and issued in Germany would be classified changes from a short-term bond to a
as a Eurobond. indicates that this group of investors is
exempt from receiving a prospectus on a long- term bond.
European-Style Option new issue as they are considered to be Face Value
An option that can only be exercised on a sophisticated and knowledgeable. The value of a bond or debenture that
specified date normally the business day appears on the face of the certificate. Face
prior to expiration. Exercise
The process of invoking the rights of the value is ordinarily the amount the issuer
option or warrant contract. It is the holder
will pay at maturity. Face value is no First Mortgage Bonds Floating Exchange Rate
indication of market value. The senior securities of a company as they A country whose central bank allows market
constitute a first charge on the companys forces alone to determine the value of its
Fee-Based Accounts assets, earnings and undertakings before currency, but will intervene if it thinks the
A type of account that bundles various unsecured current liabilities are paid. move in the exchange rate is excessive or
services into a fee based on the clients disorderly.
assets under management, for example, 1% Fiscal Agent
to 3% of client assets. An investment dealer appointed by a Floating Rate
company or government to advise it in A term used to describe the interest
Fiduciary Responsibility financial matters and to manage the payments negotiated in a particular contract.
The responsibility of an investment advisor, underwriting of its securities. In this case, a floating rate is one that is
mutual fund salesperson or financial based on an administered rate, such as the
planner to always put the clients interests Fiscal Policy Prime Rate. For example, the rate for a
first. The fiduciary is in a position of trust The policy pursued by the federal particular note may be 2% over Prime. See
and must act accordingly. government to influence economic growth also Fixed Rate.
through the use of taxation and
Final Good government spending to smooth out the Floating-Rate Debentures
A finished product, one that is purchased fluctuations of the business cycle. A type of debenture that offers protection
by the ultimate end user. to investors during periods of very volatile
Fiscal Year interest rates. For example, when interest
Final Prospectus A companys accounting year. Due to the
The prospectus which supersedes the rates are rising, the interest paid on floating
nature of particular businesses, some rate debentures is adjusted upwards every
preliminary prospectus and is accepted companies do not use the calendar year for
for filing by applicable provincial securities six months.
their bookkeeping. A typical example is the
commissions. The final prospectus shows department store that finds December 31 Floor Trader
all required information pertinent to the too early a date to close its books after the Employee of a member of a stock exchange,
new issue and a copy must be given to each Christmas rush and so ends its fiscal year who executes buy and sell orders on the
first-time buyer of the new issue. on January 31. floor (trading area) of the exchange for the
Financial Intermediary firm and its clients.
Fixed Asset
An institution such as a bank, life insurance A tangible long-term asset such as land, Forced Conversion
company, credit union or mutual fund building or machinery, held for use rather When a companys stock rises in value above
which receives cash, which it invests, from than for processing or resale. A statement the conversion price a company may force
suppliers of capital. of financial position category. the convertible security holder to exchange
Financial Risk the security for stock by calling back the
Fixed Exchange Rate Regime security. Faced with receiving a lower call
The additional risk placed on the common A country whose central bank maintains
shareholders from a companys decision to price (par plus a call premium) or higher
the domestic currency at a fixed level against valued shares the investor is forced to
use debt to finance its operations. another currency or a composite of other convert into common shares.
Financing currencies.
The purchase for resale of a security issue Foreign Bonds
Fixed-Floater Preferred If a Canadian company issues debt securities
by one or more investment dealers. The See Delayed Floater.
formal agreement between the investment in another country, denominated in that
dealer and the corporation issuing the Fixed-Income Securities foreign countrys currency, the bond is
securities is called the underwriting Securities that generate a predictable stream known as a foreign bond. A bond issued in
agreement. A term synonymous with of interest or dividend income, such as the U.S. payable in U.S. dollars is known as
underwriting. bonds, debentures and preferred shares a foreign bond or a Yankee Bond. See
also Eurobond.
Firewall Fixed-Reset Preferred
Policies implemented to separate and See Delayed Floater. Foreign Exchange Rate Risk
isolate persons within a firm who make The risk associated with an investment in a
Flat foreign security or any investment that pays
investment decisions from persons within a
Means that the quoted market price of a in a denomination other than Canadian
firm who are privy to undisclosed material
bond or debenture is its total cost (as dollars, the investor is subject to the risk
information which may influence those
opposed to an accrued interest transaction). that the foreign currency may depreciate in
decisions. For example, there should be
Bonds and debentures in default of interest value.
separate fax machines for research
trade flat.
departments and sales departments.
First-In-First-Out (FIFO)
Inventory items acquired earliest are sold
first.
gives the planholder the right to withdraw a the lower-earning spouse to reduce taxable the real returns produced by those financial
certain fixed percentage (7% is typical) of income. assets.
the initial deposit every year until the entire
principal is returned, no matter how the Income Tax Act (ITA) Information Circular
fund performs. The legislation dictating the process and Document sent to shareholders with a
collection of federal tax in Canada, proxy, providing details of matters to come
Halt in Trading administered by Canada Revenue Agency. before a shareholders meeting.
A temporary halt in the trading of a
security to allow significant news to be Income Trusts Initial Public Offering (IPO)
reported and widely disseminated. Usually A type of investment trust that holds A new issue of securities offered to the
the result of a pending merger or a investments in the operating assets of a public for investment for the very first
substantial change in dividends or earnings. company. Income from these operating time. IPOs must adhere to strict
assets flows through to the trust, which in government regulations as to how the
Hedge Funds turn passes on the income to the trust investments are sold to the public.
Lightly regulated pools of capital in which unitholders.
the hedge fund manager invests a Initial Sales Charge
significant amount of his or her own capital Index A commission paid to the financial adviser
into the fund and whose offering A measure of the market as measured by a at the time that the policy is purchased.
memorandum allows for the fund to basket of securities. An example would be This type of sales charge is also known as
execute aggressive strategies that are the S&P/TSX Composite Index or the an acquisition fee or a front-end load.
unavailable to mutual funds such as short S&P 500. Fund managers and investors use
a stock index to measure the overall Insider
selling. All directors and senior officers of a
direction and performance of the market.
Hedging corporation and those who may also be
A protective manoeuvre; a transaction Index-Linked GICs presumed to have access to nonpublic or
intended to reduce the risk of loss from A hybrid investment product that inside information concerning the company;
price fluctuations. combines the safety of a deposit instrument also anyone owning more than 10% of the
with some of the growth potential of an voting shares in a corporation. Insiders are
High Frequency Trading (HFT) equity investment. They have grown in prohibited from trading on this information.
A sub-set of algorithmic trading. High popularity, particularly among conservative
frequency trading is characterized by a very investors who are concerned with safety of Insider Report
large number of orders for individual trades capital but want yields greater than the A report of all transactions in the shares of
of very small size done at extremely high interest on standard interest bearing GICs a company by those considered to be
speed. or other term deposits. insiders of the company and submitted
each month to securities commissions.
High Water Mark Indexing
Used in the context of how a hedge fund A portfolio management style that involves Instalment Debentures
manager is compensated. The high water buying and holding a portfolio of securities A bond or debenture issue in which a
mark sets the bar above which the fund that matches, closely or exactly, the predetermined amount of principal
manager is paid a portion of the profits composition of a benchmark index. matures each year.
earned for the fund. Instalment Receipts
Individual variable insurance
Holding Period Return contract (IVIC) A new issue of stock sold with the obligation
A transactional rate of return measure that The term used in the IVIC Guidelines to that buyers will pay the issue price in a
takes into account all cash flows and describe a segregated fund contract. specified series of instalment payments
increases or decreases in a securitys value instead of one lump sum payment. Also
for any time frame. Time frames can be Inflation known as Partially Paid Shares.
greater or less than a year. A generalized, sustained trend of rising
prices. Institutional Client
Hypothecate A legal entity that represents the collective
To pledge securities as collateral for a loan. Inflation Rate financial interests of a large group. A
Referred to as collateral assignment or The rate of change in prices. See also mutual fund, insurance company, pension
hypotec in Qubec for segregated funds. Consumer Price Index. fund and corporate treasury are just a few
examples.
ICE Futures Canada (formerly the Inflation Rate Risk
Winnipeg Commodity Exchange) The risk that the value of financial assets Intangible Asset
An exchange that trades agricultural futures and the purchasing power of income will An asset having no physical substance (e.g.,
and options exclusively. decline due to the impact of inflation on goodwill, patents, franchises, copyrights).
Interval Funds they normally issue more shares or units as Issued Shares
A type of mutual fund that has the people want them. That part of authorized shares that have
flexibility to buy back its outstanding Investment Counsellor been sold by the corporation and held by
shares periodically. Also known as A professional engaged to give investment the shareholders of the company.
closed-end discretionary funds. advice on securities for a fee. Junior Bond Issue
In-the-Money Investment Dealer A corporate bond issue, the collateral for
A call option is in-the-money if its strike A person or company that engages in the which has been pledged as security for
price is below the current market price of business of trading in securities in the other more senior debt issues and is
the underlying security. A put option is capacity of an agent or principal and is a therefore subject to these prior claims.
in-the-money if its strike price is above the member of IIROC.
current market price of the underlying Junior Debt
security. The in-the-money amount is the Investment Industry Association of One or more junior bond issues.
options intrinsic value. Canada (IIAC) Keynesian Economics
A member-based professional association Economic policy developed by British
Intrinsic Value that represents the interests of market
That portion of a warrant or call options economist John Maynard Keynes who
participants. proposed that active government
price that represents the amount by which
the market price of a security exceeds the Investment Industry Regulatory intervention in the market was the only
price at which the warrant or call option Organization of Canada (IIROC) method of ensuring economic growth and
may be exercised (exercise price). Considered The Canadian investment industrys prosperity. See also Monetarism.
the theoretical value of a security (i.e., what national self-regulatory organization. Know Your Client Rule (KYC)
a security should be worth or priced at in IIROC carries out its regulatory The cardinal rule in making investment
the market). responsibilities through setting and recommendations. All relevant information
about a client must be known in order to Liabilities they are risk averse. Borrowers, however,
ensure that the registrants recommendations Debts or obligations of a company, usually want long-term money. In order to entice
are suitable. divided into current liabilitiesthose due investors to invest long-term, borrowers
and payable within one yearand must offer higher rates for longer-term
Labour Force long-term liabilitiesthose payable after money. This being the case, the yield curve
The sum of the population aged 15 years one year. A statement of financial should slope upwards reflecting the higher
and over who are either employed or position category. rates for longer borrowing periods.
unemployed.
Liability Traders Liquidity Ratios
Labour Sponsored Venture Capital Have the responsibility to manage a dealers Financial ratios that are used to judge the
Corporations (LSVCC) trading capital to encourage market flows companys ability to meet its short-term
LSVCCs are investment funds, sponsored and facilitate the client orders that go into commitments. See Current Ratio.
by labour organizations, that have a specific the market, while aiming to lose as little of
mandate to invest in small to medium-sized that capital as possible. Liability traders can Liquidity Risk
businesses. To encourage this mandate, be considered those who set the direction The risk that an investor will not be able to
governments offer generous tax credits to for agency traders. Whereas agency traders buy or sell a security quickly enough
investors in LSVCCs. have formal client responsibilities, liability because buying or selling opportunities are
traders have lighter responsibilities or none limited.
Lagging Indicators
A selection of statistical data, that on at all. Listed Stock
average, indicate highs and lows in the Life Cycle The stock of a company which is traded on
business cycle behind the economy as a A model used in financial planning that a stock exchange.
whole. These relate to business tries to link age with investing. The
expenditures for new plant and equipment, Listing Agreement
underlying theory is that an individuals A stock exchange document published when
consumers instalment credit, short-term asset mix will change, as they grow older.
business loans, the overall value of a companys shares are accepted for listing.
However the life cycle is not a substitute It provides basic information on the
manufacturing and trade inventories. for the know your client rule. company, its business, management, assets,
Large Value Transfer System Limit Order capitalization and financial status.
(LVTS) A clients order to buy or sell securities at a
A Canadian Payments Association Load
specific price or better. The order will only The portion of the offering price of shares
electronic system for the transfer of large be executed if the market reaches or betters
value payments between participating of most open-end investment companies
that price. (mutual funds) which covers sales
financial institution.
Limited Liability commissions and all other costs of
Leading Indicators The word limited at the end of a Canadian distribution.
A selection of statistical data that, on companys name implies that liability of the
average, indicate highs and lows in the London InterBank Offered Rate
companys shareholders is limited to the (LIBOR)
business cycle ahead of the economy as a money they paid to buy the shares. By
whole. These relate to employment, capital The rate of interest charged by large
contrast, ownership by a sole proprietor or international banks dealing in Eurodollars
investment, business starts and failures, partnership carries unlimited personal
profits, stock prices, inventory adjustment, to other large international banks.
legal responsibility for debts incurred by
housing starts and certain commodity prices. the business. Long Position
LEAPS Signifies ownership of securities. I am long
Limited Partnership 100 BCE common means that the speaker
Long Term Equity Anticipation Securities A type of partnership whereby a limited
are long-term (2-3 year) option contracts. owns 100 common shares of BCE Inc.
partner cannot participate in the daily
Leverage business activity and liability is limited to Long-Term Bond
The effect of fixed charges (i.e., debt the partners investment. A bond with greater than 10 years
interest or preferred dividends, or both) on remaining to maturity.
Liquidity
per-share earnings of common stock. 1. The ability of the market in a particular Macroeconomics
Increases or decreases in income before security to absorb a reasonable amount of Macroeconomics focuses on the
fixed charges result in magnified percentage buying or selling at reasonable price performance of the economy as a whole. It
increases or decreases in earnings per changes. 2. A corporations current assets looks at the broader picture and to the
common share. Leverage also refers to relative to its current liabilities; its cash challenges facing society as a result of the
seeking magnified percentage returns on an position. limited amounts of natural resources,
investment by using borrowed funds, human effort and skills, and technology.
margin accounts or securities which Liquidity Preference Theory
require payment of only a fraction of the A theory that tries to explain the shape of
underlying securitys value (such as rights, the yield curve. It postulates that investors
warrants or options). want to invest for the short-term because
money supply. This school of thought holders receive a proportional share of the Mutual Fund Wraps
believes that control of the money supply is interest and principal payments associated Are established with a selection of
more vital to economic prosperity than the with those mortgages. individual funds managed within a clients
level of government spending, for example. account. Mutual fund wraps differ from
See also Keynesian Policy. Mortgage Bond funds of funds. The client holds the actual
A bond issue secured by a mortgage on the funds within their account, as opposed to a
Monetary Aggregates issuers property. fund that simply invests in other funds. In
An aggregate that measures the quantity of most cases, a separate account is established
money held by a countrys households, Moving Average
The average of security or commodity for the client and the selected funds are
firms and governments. It includes various held inside that dedicated account.
forms of money or payment instruments prices calculated by adding the closing
grouped according to their degree of prices for the underlying security over a Naked Writer
liquidity, such as M1, M2 or M3. pre-determined period and dividing the A seller of an option contract who does not
total by the time period selected. own an offsetting position in the underlying
Monetary Policy security or a suitable alternative.
Economic policy designed to improve the Moving Average Convergence-
performance of the economy by regulating Divergence (MACD) NASDAQ
money supply and credit. The Bank of A technical analysis tool that takes the An acronym for the National Association
Canada achieves this through its influence difference between two moving averages of Securities Dealers Automated Quotation
over short-term interest rates. and then generates a smoothed moving System. NASDAQ is a computerized
average on the difference (the divergence) system that provides brokers and dealers
Money Market between the two moving averages. with price quotations for securities traded
That part of the capital market in which OTC.
short-term financial obligations are bought Multi-Disciplinary Accounts
and sold. These include treasury bills and Fee-based accounts that are an evolution of National Debt
other federal government securities, and separately managed accounts. With The accumulation of total government
commercial paper, and bankers multi-disciplinary accounts, separate borrowing over time .It is the sum of past
acceptances and other instruments with models are combined into one overall deficits minus the sum of past surpluses.
one year or less left to maturity. Longer portfolio model in a single account.
National Policies
term securities, when their term shortens to Multi-Manager Accounts The Canadian Securities Administrators
the limits mentioned, are also traded in the A type of fee-based account that offers have developed a number of policies that
money market. clients and their advisors more choice in are applicable across Canada. These
Money Purchase Plan (MPP) terms of product and services. Often, coordinated efforts by the CSA are an
A type of Registered Pension Plan; also clients are aligned with two or more attempt to create a national securities
called a Defined Contribution Plan. In portfolio models and each portfolio model regulatory framework. Copies of policies
this type of plan, the annual payout is is a component of the clients greater are available from each provincial regulator.
based on the contributions to the plan and diversified holdings.
National Do Not Call List (DNCL)
the amounts those contributions have Multiple The Canadian Radio-television and
earned over the years preceding retirement. A colloquial term for the Price/Earnings Telecommunications Commission (CRTC)
In other words, the benefits are not known ratio of a companys common shares. has established Rules that telemarketers and
but the contributions are.
Mutual Fund organizations that hire telemarketers must
Montral Exchange (ME) An investment fund operated by a company follow. The DNCL Rules prohibit
See Bourse de Montral. that uses the proceeds from shares and telemarketers and clients of telemarketers
units sold to investors to invest in stocks, from calling telephone numbers that have
Mortgage been registered on the DNCL for more
A contract specifying that certain property bonds, derivatives and other financial
securities. Mutual funds offer investors the than 31 days.
is pledged as security for a loan.
advantages of diversification and National Registration Database
Mortgage-Backed Securities professional management and are sold on a (NRD)
Bonds that claim ownership to a portion of load or no load basis. Mutual fund shares/ A web-based system that permits mutual
the cash flows from a group or pool of units are redeemable on demand at the fund salespersons and investment advisors
mortgages. They are also known as funds current net asset value per share to file applications for registration
mortgage pass-through securities. A (NAVPS). electronically.
servicing intermediary collects the monthly
payments from the issuers and, after Mutual Fund Dealers Association Natural Unemployment Rate
deducting a fee, passes them through (i.e., (MFDA) Also called the full employment
remits them) to the holders of the security. The Self-Regulatory Organization (SRO) unemployment rate. At this level of
The MBS provides liquidity in an that regulates the distribution (dealer) side unemployment, the economy is thought to
otherwise illiquid market. Every month, of the mutual fund industry in Canada. be operating at close to its full potential or
capacity.
Negative Pledge Provision gives relevant information to make suitable Non-Competitive Tender
A protective provision written into the trust investment recommendations. The NAAF A method of distribution used in particular
indenture of a companys debenture issue must be completed and approved before by the Bank of Canada for Government of
providing that no subsequent mortgage any trades are put through on an account. Canada marketable bonds. Primary
bond issue may be secured by all or part of distributors are allowed to request bonds at
the companys assets, unless at the same New Issue the average price of the accepted
time the companys debentures are similarly An offering of stocks or bonds sold by a competitive tenders. There is no guarantee
secured. company for the first time. Proceeds may as to the amount, if any, received in
be used to retire outstanding securities of response to this request.
Negotiable the company, to purchase fixed assets or for
A certificate that is transferable by delivery additional working capital. New debt issues Non-Controlling Interest
and which, in the case of a registered are also offered by government bodies. 1. The equity of the shareholders who do
certificate, has been duly endorsed and not hold controlling interest in a controlled
guaranteed. New York Stock Exchange (NYSE) company; 2. In consolidated financial
Oldest and largest stock exchange in North statements (i) the item in the statement of
Negotiated Offer America with more than 1,600 companies financial position of the parent company
A term describing a particular type of listed on the exchange. representing that portion of the assets of a
financing in which the investment dealer consolidated subsidiary considered as
negotiates with the corporation on the NEX
A new and separate board of the TSX accruing to the shares of the subsidiary not
issuance of securities. The details would owned by the parent; and (ii) the item
include the type of security to be issued, Venture Exchange that provides a trading
forum for companies that have fallen below deducted in the statement of
the price, coupon or dividend rate, special comprehensive income of the parent and
features and protective provisions. the Venture Exchanges listing standards.
Companies that have low levels of business representing that portion of the subsidiarys
Net Asset Value activity or who do not carry on active earnings considered as accruing to the
For a mutual fund, net asset value business will trade on the NEX board, subsidiarys shares not owned by the parent.
represents the market value of the funds while companies that are actively carrying Non-Cumulative
share and is calculated as total assets of a on business will remain with the main TSX A preferred dividend that does not accrue
corporation less its liabilities. Net asset Venture Exchange stock list. or accumulate if unpaid.
value is typically calculated at the close of
each trading day. Also referred to as the No Par Value (n.p.v.) Odd Lot
book value of a companys different classes Indicates a common stock has no stated A number of shares which is less than a
of securities. face value. standard trading unit. Usually refers to a
Nominal GDP securities trade for less than 100 shares,
Net Change sometimes called a broken lot. Trading in
The change in the price of a security from Gross domestic product based on prices
prevailing in the same year not corrected less than 100 shares typically incurs a
the closing price on one day to the closing higher per share commission.
price on the following trading day. In the for inflation. Also referred to as current
case of a stock which is entitled to a dollar or chained dollar GDP. Of Record
dividend one day, but is traded ex- Nominal Rate On the companys books or records. If, for
dividend the next, the dividend is not The quoted or stated rate on an investment example, a company announces that it will
considered in computing the change. The or a loan. This rate allows for comparisons pay a dividend on January 15 to
same applies to stock splits. A stock selling but does not take into account the effects shareholders of record, every shareholder
at $100 the day before a two-for-one split of inflation. whose name appears on the companys
and trading the next day at $50 would be books on that date will be sent a dividend
considered unchanged. The net change is Nominee cheque from the company.
ordinarily the last figure in a stock price A person or firm (bank, investment dealer,
list. The mark +1.10 means up $1.10 a CDS) in whose name securities are Offer
share from the last sale on the previous day registered. The shareholder, however, The lowest price at which a person is
the stock traded. retains the true ownership of the securities. willing to sell; as opposed to bid which is
the highest price at which one is willing to
Net Profit Margin Non-Client and Professional buy.
A profitability ratio that indicates how Orders
efficiently the company is managed after A type of order for the account of partners, Offering Memorandum
taking into account both expenses and directors, officers, major shareholders, IAs This document is prepared by the dealer
taxes. and employees of member firms that must involved in a new issue outlining some of
be marked PRO , N-C or Emp, in the salient features of the new issue, but
New Account Application Form order to ensure that client orders are given not the price or other issue-specific details.
(NAAF) priority for the same securities. It is used as a pre-marketing tool in
A form that is filled out by the client and assessing the market for the issue as well as
the IA at the opening of an account. It for obtaining expressions of interest.
Pari Passu honoured. The performance bond is often Preferred Dividend Coverage
A legal term meaning that all securities referred to as margin. Ratio
within a series have equal rank or claim on A type of profitability ratio that measures
earnings and assets. Usually refers to Personal Disposable Income the amount of money a firm has available
equally ranking issues of a companys The amount of personal income an to pay dividends to their preferred
preferred shares. individual has after taxes. The income that shareholders.
can be spent on necessities, nonessential
Participating Preferred goods and services, or that can be saved. Preferred Shares
Preferred shares which, in addition to their A class of share capital that entitles the
fixed rate of prior dividend, share with the Phillips Curve owners to a fixed dividend ahead of the
common in further dividend distributions A graph showing the relationship between companys common shares and to a stated
and in capital distributions above their par inflation and unemployment. The theory dollar value per share in the event of
value in liquidation. states that unemployment can be reduced liquidation. Usually do not have voting
in the short run by increasing the price rights unless a stated number of dividends
Participation Rate level (inflation) at a faster rate. Conversely, have been omitted. Also referred to as
The share of the working-age population inflation can be lowered at the cost of preference shares.
(15 and older) that is in the labour market, possibly increased unemployment and
either working or looking for work. slower economic growth. Preliminary Prospectus
The initial document released by an
Partnership Point underwriter of a new securities issue to
A form of business organization that Refers to security prices. In the case of prospective investors.
involves two or more people contributing shares, it means $1 per share. In the case of
to the business and legislated under the bonds and debentures, it means 1% of the Premium
federal Partnership Act. issues par value, which is almost universally The amount by which a preferred stock or
100. On a $1,000 bond, one point debt security may sell above its par value.
Past Service Pension Adjusted In the case of a new issue of bonds or
represents 1% of the face value of the bond
(PSPA) stocks, the amount the market price rises
or $10. See Basic point
An employer may increase a members over the original selling price. Also refers to
pension by the granting of additional past Political Risk that part of the redemption price of a
service benefits to an employee in a defined The risk associated with a government bond or preferred share in excess of face
benefit plan. Plan members who incur a introducing unfavourable policies making value, par value or market price. In the case
PSPA will have their RRSP contribution investment in the country less attractive. of options, the price paid by the buyer of
room reduced by the amount of this Political risk also refers to the general an option contract to the seller.
adjustment. instability associated with investing in a
particular country. Prepaid Expenses
Payback Period Payments made by the company for
The time that it takes for a convertible Pooled Account services to be received in the near future.
security to recoup its premium through its A type of managed product structure For example, rents, insurance premiums
higher yield, compared with the dividend whereby by investors funds are gathered and taxes are sometimes paid in advance. A
that is paid on the stock. into a legal structure, usually a trust or statement of financial position item.
corporation. An investors claim to the
Peer Group Prepayment Risk
pools returns is proportional to the
A group of managed products (particularly The risk that the issuer of a bond might
number of shares or units the investor
mutual funds) with a similar investment prepay or redeem early some or all principal
owns. The pools are often open-ended,
mandate. outstanding on the loan or mortgage.
which means units are issued when there
Pension Adjustment (PA) are net cash inflows to the fund, or units
Prescribed Rate
The amount of contributions made or the are redeemed when there are net cash
A quarterly interest rate set out, or
value of benefits accrued to a member of an outflows.
prescribed by Canada Revenue Agency
employer-sponsored retirement plan for a under attribution rules. The rate is based
Portfolio
calendar year. The PA enables the individual on the Bank of Canada rate.
Holdings of securities by an individual or
to determine the amount that may be
institution. A portfolio may contain debt
contributed to an RRSP that would be in Present Value
securities, preferred and common stocks of
addition to contributions into a Registered The current worth of a sum of money that
various types of enterprises and other types
Pension Plan. will be received sometime in the future.
of securities.
Performance Bonds Price-Earnings (P/E) Ratio
Potential Output
What is often required upon entry into a A value ratio that gives investors an idea of
The maximum amount of output the
futures contract giving the parties to a how much they are paying for a companys
economy is capable of producing during a
contract a higher level of assurance that the earnings. Calculated as the current price of
given period when all of its available
terms of the contract will eventually be the stock divided current earnings per
resources are employed to their most
share.
efficient use.
proceeds from trades in a secondary market Self-Regulatory Organization contains by reference the material filed by
go to the selling dealers and investors, (SRO) the corporation in the Annual
rather than to the companies that originally An organization recognized by the Information Form.
issued the shares in the primary market. Securities Administrators as having powers
to establish and enforce industry Short Position
Securities regulations to protect investors and to Created when an investor sells a security
Paper certificates or electronic records that maintain fair, equitable, and ethical that he or she does not own. See also short
evidence ownership of equity (stocks) or practices in the industry and ensure sale.
debt obligations (bonds). conformity with securities legislation. Short Sale
Securities Acts Canadian SROs include the Investment The sale of a security which the seller does
Provincial Acts administered by the Industry Regulatory Organization of not own. This is a speculative practice done
securities commission in each province, Canada and, the Mutual Fund Dealers in the belief that the price of a stock is
which set down the rules under which Association. going to fall and the seller will then be able
securities may be issued and traded. Selling Group to cover the sale by buying it back later at a
Investment dealers or others who assist a lower price, thereby making a profit on the
Securities Administrator transactions. It is illegal for a seller not to
A general term referring to the provincial banking group in marketing a new issue of
securities without assuming financial declare a short sale at the time of placing
regulatory authority (e.g., Securities the order. See also Margin.
Commission or Provincial Registrar) liability if the issue is not entirely sold. The
responsible for administering a provincial use of a selling group widens the Short-Term Bond
Securities Act. distribution of a new issue. A bond with greater than one year but less
Sell Side than five years to maturity.
Securities Eligible for Reduced
Margin Refers to dealers. The term stems from the Short-Term Debt
Securities which demonstrate sufficiently role broker/dealers play in the underwriting Company borrowings repayable within one
high liquidity and low price volatility based and distribution of new issue securities. year that appear in the current liabilities
on meeting specific price risk and liquidity Sentiment Indicators section of the statement of financial
risk measures. Measure investor expectations or the mood position. The most common short-term
of the market. These indicators measure debt items are: bank advances or loans,
Securitization notes payable and the portion of funded
Refers in a narrow sense to the process of how bullish or bearish investors are.
debt due within one year.
converting loans of various sorts into Separately Managed Account
marketable securities by packaging the A managed product structure whereby Single-Manager Account
loans into pools. In a broader sense, refers individual accounts are created for each A type of fee-based account that is directed
to the development of markets for a variety investor. In either case, an investment by a single portfolio manager who focuses
of debt instruments that permit the manager is guided by an investment considerable time and attention on the
ultimate borrower to bypass the banks and mandate. selection of securities, the sectors to invest
other deposit-taking institutions and to in and the optimal asset allocation.
borrow directly from lenders. Serial Bond or Debenture
See Instalment Debenture. Simplified Prospectus
Segregated Funds A condensed prospectus distributed by
Insurance companies sell these funds as an Settlement Date mutual fund companies upon request to
alternative to conventional mutual funds. The date on which a securities buyer must purchasers and potential purchasers of fund
Like mutual funds, segregated funds offer a pay for a purchase or a seller must deliver units or shares.
range of investment objectives and the securities sold. For most securities,
categories of securities e.g. equity funds, settlement must be made on or before the Sinking Fund
bond funds, balanced funds etc. These third business day following the transaction A fund set up to retire most or all of a debt
funds have the unique feature of date. or preferred share issue over a period of
guaranteeing that, regardless of how poorly time. See also Purchase Fund.
Share of Profit of Associates
the fund performs, at least a minimum Small Cap
A companys share of an unconsolidated
percentage (usually 75% or more) of the Reference to smaller growth companies.
subsidiarys revenue. The equity accounting
investors payments into the fund will be Small cap refers to the size of the
method is used when a company owns
returned when the fund matures. capitalization or investments made in the
20% to 50% of a subsidiary.
Self-Directed RRSP company. A small cap company has been
Short-Form Prospectus defined as a company with an outstanding
A type of RRSP whereby the holder invests
Distribution System stock value of under $500 million. Small
funds or contributes certain acceptable
This system allows reporting issuers to issue cap companies are considered more volatile
assets such as securities directly into a
a short-form prospectus that contains only than large cap companies.
registered plan which is usually
information not previously disclosed to
administered for a fee by a Canadian
regulators. The short form prospectus
financial services company.
protect a short position or to ensure that a Structured Preferreds redeemed. This amount is equal to the
stock is purchased while its price is rising. See Equity Dividend Shares. market value of the segregated fund, less
According to TSX rules these orders any applicable sales charges or
Structured Product
become market orders when the stop price administrative fees.
A passive investment vehicle financially
is reached.
engineered to provide a specific risk and Suspension in Trading
Stop Loss Orders return characteristic. The value of a An interruption in trading imposed on a
The opposite of a stop buy order. An structured product tracks the returns of company if their financial condition does
order to sell a security after its price falls to reference security known as an underlying not meet an exchanges requirements for
a certain amount, thus limiting the loss or asset. Underlying assets can consist of a continued trading or if the company fails
protecting a paper profit. According to single security, a basket of securities, foreign to comply with the terms of its listing
TSX rules these orders become market currencies, commodities or an index. agreement.
orders when the stop price is reached.
Subordinated Debenture Swap
Stop Orders A type of junior debenture. Subordinate An over-the-counter forward agreement
Orders that are used to buy or sell after a indicates that another debenture ranks involving a series of cash flows exchanged
stock has reached a certain price. See Stop ahead in terms of a claim on assets and between two parties on specified future
Buy Orders, Stop Loss Orders. profits. dates.