Investing Terms

Expenses shown on the income statement but not yet paid
stock trading when the major stock exchanges are closed
This is an instruction you can give your broker when placing a buy or a sell order This instruction ensures that your order will be filled in its entirety or not at all This prevents having a partial execution of your trade
An order that must be filled completely or the trade will not take place
A certificate trading on a US stock exchange that represents shares of a foreign corporation
Options that can be exercised any time during their lifetime These are also known as open options
Someone typically working for a brokerage house who publishes buyholdsell recommendations and earnings forecasts for a stock Buy side analysts work for institutional buyers and sell side analysts work for brokerages
A publication including financial statements and a report on operations issued by a company to its shareholders at the companys fiscal year-end

The lowest price at which someone is willing to sell the security When combined with the bid price information it forms the basis of a stock quote
The price you are asked to pay when you buy a stock see Bid Price
The aggregate size in board lots of the most recent ask to sell a particular security
The process of dividing your funds among different classes of investments such as stock bond or real estate You could further allocate your stock funds into value growth foreign etc
Everything a company or person owns including money securities equipment and real estate Assets include everything that is owed to the company or person Assets are listed on a companys balance sheet or an individuals net worth statement
This is the price of the last trade of a stock when the market closes for the day This price is of primary importance in our trading as where a stock closes in its range tells us much about the direction and momentum of the stock
This is a stocks trading price when a stock begins trading for the day It may gap up gap down or open where it closed the previous session Where a stock opens can be deceptive especially if the stock gaps up or down significantly from the closing price
Average number of shares traded per day over a specified period
Average priceearnings ratio of stocks owned by a mutual fund
Statistical tools that measure the state of the stock market or the economy based on the performance of stocks bonds or other components Examples are the SPTSX Venture Composite Index the SPTSX Composite Index the Dow Jones Industrial Average and the Consumer Price Index
Buying more of a security at a price that is lower than the price paid for the initial investment The aim of averaging down is to reduce the average cost per unit of the investment
Sales charge paid when selling a mutual fund aka deferred load
Determining the results of using particular screening criteria as if the screen had been run at some point back in time and the selected stocks or funds were held for a predetermined time period and then sold
A financial statement listing a companys assets what it owns and liabilities what it owes as of a specific date usually the last day of a companys fiscal quarter The difference between a companys assets and liabilities is termed its net worth or shareholders equity
This occurs when a stock trades sideways in various signature patterns eg cup with handle saucer base flat base while it is under accumulation prior to its next move up We look for these stocks as they can lead to explosive moves out of the bases
A longer period of time when prices in the market are generally declining Bear markets typically are much shorter-lived than bull markets but are usually more severe given the time period involved We try to play corrections and bear markets to the downside as they can generate tremendous returns in a short time period
A false signal which indicates that the rising trend of a stock or index has reversed when in fact it has not
A type of underwriting where the investment firm acts as an agent The firm agrees to use its best efforts to sell the new issue of securities but does not guarantee the issuing company that the securities to be issued will be sold
An order with a limit price better than the best price on the opposite side of the market A better-priced buy order has a limit price higher than the best offering A better-priced sell order has a limit price lower than the best bid These are available only at the opening

The highest price a buyer is willing to pay for a stock When combined with the ask price information it forms the basis of a stock quote
The aggregate size in board lots of the most recent bid to buy a particular security
A model used to estimate the price of an option
A mathematical model used to calculate the theoretical price of an option
A single purchase or sale of a stock involving 10000 or more shares
Stocks of leading and nationally known companies that offer a record of continuous dividend payments and other strong investment qualities
Large stabile companies
A standard trading unit as defined in UMIR Universal Market Integrity Rules The board lot size of a security on Toronto Stock Exchange or TSX Venture Exchange depends on the trading price of the security as follows Trading price per unit is less than 010 - board lot size is 1000 units Trading price per unit is 010 to 099 - board lot size is 500 units Trading price per unit is 100 or more - board lot size is 100 units
An electronic record of all pending buy and sell orders for a particular stock
The ratio of a companys new orders to shipments in the same period A book to bill ratio greater than 10 indicates sales growth Ratios less than 10 reflect shrinking sales Used mostly in the semiconductor industry
Orders that do not trade immediately upon entry These orders are also known as outstanding orders
After-tax earnings Literally the bottom line on an income statement aka net income or profit
Rather than simply acting as an agent an investment bank or other underwriters directly purchase securities from the issuer usually at a discount to the market price and then sells them to investors
A type of underwriting where the brokerage firm acts as principal The brokerage firm risks its own capital to purchase all of the securities to be issued If the price of the securities decreases before the brokerage firm has had a chance to resell the securities to its clients the firm absorbs the loss
This occurs when a stock hits support in the form of an old high a moving average a trend line or a combination of these and moves up sharply It is like dropping a ball onto a concrete sidewalk-the sidewalk is hard support and the ball bounces sharply Not all support is strong enough for a bounce-we look for old tops highs on the way up breakout points they act as resistance until the breakout-if the breakout is on good volume it should act as support and give you a bounce If money flow is good and the market is not tanking we usually see a bounce off of this solid support
Option arbitrage in which a profitable position is established with no risk One spread is established with call options The other spread is established using put options
We often write about stocks that test their breakout prices Stocks breaking to new highs or out of consolidations often come back to test the breakout point before continuing with the breakout This is most likely due to certain investors taking profits If the breakout is a strong one buyers come back in at some point before the stock falls below the breakout This starts the stock back up on the next leg This test can happen the next day or it can happen after a week of upward movement That is why we advise those in on the breakout move to watch for a test If the stock has had a good move you dont want to lose profit on a big test-you can always get back in when the stock moves back up For a small test soon after the break you can ride it down but you have to be careful the stock does not fall back within its previous trading range Good breakout volume is a sign that this is less likely to happen There are two plays on the breakout test when the stock turns back up on good volume or when the stock tops its breakout high The former is riskier in that the breakout high can act as resistance but we will play this move if the other indicators are good-volume money flow relative strength The safer play is the break over the recent breakout high as this shows there is no resistance If the volume is still good the stock will most likely continue its breakout
A securities firm or a registered investment advisor affiliated with a firm Brokers are the link between investors and the stock market When acting as a broker for the purchase or sale of listed stock the investment advisor does not own the securities but acts as an agent for the buyer and seller and charges a commission for these services
A market in which stock prices are rising
A false signal which indicates that the price of a stock or index has reversed to an upward trend but ultimately proves to be false
Stocks that dont qualify for NASDAQ listing are traded here or by Pink Sheets Be careful
Any day from Monday to Friday excluding statutory holidays
A trust that usually generates cash flows from one business or operating company unlike an investment fund which generates income from a diversified pool or portfolio The trust holds debt and equity interests of an operating business Businesses that exhibit these characteristics may opt for a trust structure over a corporate structure to take advantage of tax efficiency
Analyst working for mutual fund or other institutional investor We dont usually get to see their reports
If a broker fails to deliver securities sold to another broker on the settlement date the receiving broker may buy the securities at the current market price of the stock and charge the delivering broker the cost difference of such a purchase
To an economist capital means machinery factories and inventory required to produce other products To investors capital means their cash plus the financial assets they have invested in securities their home and other fixed assets
Profit or loss resulting from the sale of certain assets classified under the federal income tax legislation as capital assets This includes stocks and other investments such as investment property
Balance sheet liability reflecting lease payments due for the term of the lease
The TSX Venture Exchange Capital Pool Company CPC program offers a unique listing opportunity that brings experienced management teams with proven public financing ability together with development-stage companies in need of capital and management expertise Unlike traditional public companies capital pools list and begin trading without an operating business The nature of their business is to find and acquire a promising early-stage venture and their treasuries are funded expressly for the search and due diligence process
All shares representing ownership of a company including preferred and common shares
A form of financial trust that differs from other trusts in that it looks more like a fixed income instrument than an equity issue Capital trusts are generally issued by banks or other financial intermediaries These investment vehicles trade like a debt instrument with 1000 face value and trade with accrued interestThe business objective of capital trusts is to acquire and hold assets that will generate net income for distribution to unit holders The trusts assets may consist of residential mortgages mortgage co-ownership interests mortgage-backed securities other eligible investments and other qualified debt obligations Capital trust assets are usually acquired from and serviced by the issuing institution andor its affiliates
Any change in the issued and outstanding listed securities of an issuer This change may involve the issuance repurchase or cancellation of listed securities or listed securities that are issuable upon conversion or exchange of other securities of an issuer
The date that the capitalization change is reflected in the issuers share register regardless of when it is reported to the Exchange
Total dollar amount of all money invested in a company such as debt preferred and common stock contributed surplus and retained earnings of a company
Largest companies have most influence on index price action
Indices for which there is a maximum relative weight by market capitalization for any one constituent Any individual constituent of the index can represent no more than a specified percent of the index The individual constituents of the SPTSX Capped Composite and SPTSX Capped 60 indices are capped at 10 while the individual constituents of the SPTSX Capped sector indices are capped at 25
Profiting on interest rate differentials For instance borrowing money at a relatively low short-term rate and lending it out a higher long-term rates
A special term attached to an equity order that requires the trade to be settled either the same day or the following business day for cash
Cash in bank and all securities that can readily be converted to cash within three months or less
A dividenddistribution that is paid in cash
After tax income minus preferred dividends and general partner distributions plus depreciation depletion and amortization Market Guide definition See Operating Cash Flow and Free Cash Flow
Settlement of an option contract not by delivery of the underlying shares but by a cash payment of the difference between the strike or exercise price and the underlying settlement price
The physical document that shows ownership of a bond stock or other security
Any modification to the list of tradable issues of an exchange These modifications include new listings supplemental security listings substitutional listings deletions name changes and stock symbol changes
A real-time message area usually dedicated to a particular topic
Any business day on which the clearing corporation is open to effect trade clearing and settlement
The trading number of the clearing Participating Organization or Member
An order from a retail customer of a Participating Organization
Investors buy shares from other share holders and sell shares to other investors Share price is determined by supply and demand for fund shares as opposed to Net Asset Value for open-end Funds
An investment trust that issues a fixed number of securities that trade on a stock exchange or in the over-the-counter market Assets of a closed-end fund are professionally managed in accordance with the funds investment objective and policies and may be invested in a wide range of financial instrumentsassets Like other publicly traded securities the market price of closed-end fund securities fluctuates and is determined by supply and demand in the marketplace
An order to close out an existing open futures or options contract
Products used for commerce that are traded on a separate authorized commodities exchange Commodities include agricultural products and natural resources such as timber oil and metals Commodities are the basis for futures contracts traded on these exchanges
Securities that represent part ownership in a company and generally carry voting privileges Common shareholders may be paid dividends but only after preferred shareholders are paid Common shareholders are last in line after creditors debt holders and preferred shareholders to claim any of a companys assets in the event of liquidation
Shares of a publicly held corporation usually includes voting rights Common stock has lower priority in event of liquidation than preferred shares
When an order trades all of its specified volume
A multi-party telephone call hosted by a company primarily for analysts shortly after making an earnings announcement
The average of analysts individual earnings forecasts or buysell ratings
A consolidated report that includes the total shares short as of the trade date and the net change from the previous report for both TSX and TSX Venture Exchange listed issues Under UMIR rule 1010 all TSX and TSX Venture Exchange Participating Organizations and Members must report the firms short position on a semi-monthly basis to TSX Datalinx Non-clearing firms may report through the firm that is responsible for their clearing
This is a category of stock of companies that produce consumer-oriented products like food beverages tobacco and pharmaceuticals
A companys ongoing obligation to inform the public of significant corporate events both favourable and unfavourable
Similar to value investor Looks for stocks with prices beaten down out of proportion to fundamentals
A bond that can be exchanged for shares of stock
A security of an issuer for example - bonds debentures or preferred shares that may be converted into other securities of that issuer in accordance with the terms of the conversion feature The conversion usually occurs at the option of the holder of the securities but it may occur at the option of the issuer
A form of business organization created under provincial or federal laws that has a legal identity separate from its owners The shareholders are the corporations owners and are liable for the debts of the corporation only up to the amount of their investment This is known as limited liability
This occurs when an average falls 10 or more off of its high
Cost of materials and labor required to produce products or services Gross profit is sales minus cost of sales
The interest rate on a bond
Writing an option when the writer owns the underlying security and writes the option on a one to one ratio with the stock A short call is covered if the underlying security is owned A short put is covered if the underlying security is also short in the account A short call is covered if a long call of the same underlying security is owned in the same account with the same or lower strike A short put is covered if a long put of the same underlying security is owned in the same account with a strike price equal to or greater than the strike of the short put
A trade that occurs when two accounts within the same Participating OrganizationMember wish to buy and sell the same security at an agreed price and volume With some approved exceptions crosses can only occur within the current bid and ask for the stock
With dividend The owner of shares purchased cum dividend is entitled to an upcoming already-declared dividend The opposite of this is ex dividend
With rights The owner of shares purchased cum rights is entitled to forthcoming already-declared rights The opposite of this is ex rights
The trading day before the ex-dividenddistribution ex-d date It is the last day on which the securities can be traded and on which the buyer is entitled to the dividenddistribution
A stock of a company in an industry sector that is particularly sensitive to swings in economic conditions
The maximum price advance or decline permitted for a futures contract in one trading session compared to the previous days settlement price
The highest price that a security has traded at during the day
The lowest price that a security has traded at during the day
An order that is valid only for the day it is entered If the order is still outstanding when the market closes it will be purged overnight
A measure of accounts receivables compared to sales Higher DSOs means a companys receivables as a percentage of sales have increased not a good sign
A long-term debt instrument issued by corporations or governments that is backed only by the integrity of the borrower not by collateral A debenture is unsecured and subordinate to secured debt A debenture is unsecured in that there are no liens or pledges on specific assets
The price paid per 100 of a debt instruments face value traded A debt instrument trading at par would have a price of 100 A price below face value for example 991 indicates that the debt instrument has traded at a discount A price above face value for example 1011 indicates that the debt instrument has traded at a premium
Total long term debt divided by total shareholder equity
Total short and long term debt divided by total shareholder equity
The total dollar value of volume traded on one side of the transaction for a specified period It equals price multiplied by volume divided by 100
The number of debt instruments traded on one side of the transaction for a specified period multiplied by the face value of the debt instrument
A stock purchased from a company that has maintained a record of stable earnings and continuous dividend payments through periods of economic downturn
Balance sheet liability reflecting expenses shown on the income statement that havent actually been paid
Balance sheet liability reflecting taxes due but not yet paid
Sales charge paid when selling a mutual fund aka back-end load
A balance sheet liability reflecting payments received for work not yet performed
A special term order in which there is a clear understanding between the buying and selling parties that the delivery of the securities will be delayed beyond the usual three-day settlement period to the date specified in the order
The removal of a securitys listing on a stock exchange This is done when the security no longer exists the company is bankrupt the public distribution of the security has dropped to an unacceptably low level or the company has failed to comply with the terms of its listing agreement
The status of a security that is no longer listed on the Exchange The security could trade on another market
A listed issuer is delisted when the last listed security of the issuer is delisted
The tender and receipt of the underlying commodity or the payment or receipt of cash in the settlement of an open futures contract
The combined desire ability and willingness on the part of consumers to buy goods or services Demand is determined by income and by price which are in part determined by supply
Options and other instrument whose value depends on an underlying security For instance the value of a call option on Cisco Systems derivative fluctuates with the price of Cisco Systems stock
Total of after tax bottom line earnings divided by number of common shares including unexercised stock options and unconverted preferred stock and convertible bonds Undiluted earnings would be after tax earnings divided by issued stock only not considering outstanding options etc
A plan implemented by a corporation allowing purchase of shares or fractions of shares directly from the company usually on a regular basis
The difference between a bonds face value and its current market price
A stockbroker charging lower commissions than full-service brokers Discount brokers do not give investment advice
The portion of the issuers equity paid directly to shareholders It is generally paid on common or preferred shares The issuer or its representative provides the amount frequency monthly quarterly semi-annually or annually payable date and record date The exchange that the issue is listed on sets the ex-dividenddistribution ex-d date for entitlement An issuer is under no legal obligation to pay either preferred or common dividends
Total of 12-months dividends paid historical or forecast divided by the latest share price
The date set by the issuer on which the dividenddistribution will be paid
The date on which a security holder must be registered as a holder of an issue to receive the dividenddistribution
Cash or stock paid to shareholders usually on a quarterly schedule
Investing a fixed amount of dollars in a specific security at regular set intervals over a period of time Dollar cost averaging results in a lower average cost per share compared with purchasing a constant number of shares at set intervals The investor buys more shares when the price is low and buys fewer shares when the price is high
These are reversal patterns It is a decline or advance twice to the same level plus or minus 3 It indicates support or resistance at that level These are signature patterns that are playable with little or no confirmation
A trade is on a downtick when the last trade occurred at a price lower than the previous one
Stock price is heading down
The process whereby an in-depth examination of a companys business prospects is conducted
A method of allocating shares in an IPO where you specify how much youre willing to pay for how many shares
After tax 12-months earnings divided by the number of shares outstanding
Earnings before interest and taxes Also known as operating income
Earnings before interest taxes depreciation and amortization Adds these items back to reported earnings to more accurately reflect real cash earnings of company Similar to operating cash flow except operating cash flow also considers changes in levels of inventories and receivables

Electronic Communication Network ECNs are expected to supplement or even replace conventional stock exchanges over the next one to two years
Developing countries
Investment vehicles that may engage in the development acquisition andor production of oil and gas reserves The trust receives royalty income from producing properties essentially net cash flow and then sells interests in the trust called trust units to investors Conventional oil and gas royalty trusts are actively managed portfolios holding assets of mature producing properties Substantially all of the cash flow generated by the oil and gas assets net of certain deductions such as administrative expenses and management fees is passed on to the unit holders as royalty income Capital expenses may also be deducted but are usually subject to restrictions on the amount The distributions are highly dependent upon the cash flow generated by the trust In general the largest variable in determining the level of cash flow is the price of crude oil and natural gas Royalty trusts provide an alternative from owning the shares of individual companies for investors to participate in the oil and gas sector

Earnings per share
Common and preferred stocks which represent a share in the ownership of a company
The dollar value of securities issued in accordance with a TSX or TSX Venture Exchange approved transaction The value equals the number of securities multiplied by the offering price The various forms of financial instruments may have an effect on determining the price or the number of securities
An option contract that grants the holder the right to buy or sell a specific number of shares of stock at a specified price during a specific period of time
The price per share traded
The total dollar value of volume traded on one side of the transaction for a specified period It equals price multiplied by volume
The total number of shares traded on one side of the transaction
The outstanding securities of an issuer that are not freely tradable because they are subject to an escrow agreement that restricts the ability of certain security holders of that issuer from trading or otherwise dealing in those securities until certain conditions are satisfied
Options that can be exercised only on their expiration date
The holder of shares purchased ex dividend is not entitled to an upcoming already-declared dividend but is entitled to future dividends
The holder of shares purchased ex rights is not entitled to already-declared rights but is entitled to future rights issues
Ex-dividenddistribution date The date that the buyer of a stock is not entitled to the upcoming declared dividenddistribution because the buyer will not be a holder of record The ex-d date is two clearing days before the record date The exchange that the issue is listed on sets the ex-d date
The day after dividends are paid
A form of prospectus that allows a company to conduct a prospectus offering through the facilities of a stock exchange rather than issuing them directly to the public The company then applies to list the securities on the exchange
A special type of financial trust that allows an investor to buy an entire basket of stocks through a single security which tracks and matches the returns of a stock market index ETFs are considered to be a special type of index mutual fund but they are listed on an exchange and trade like a stock Also known as an index participation unit IPU
A security of an issuer that is exchangeable for securities of another issuer usually a subsidiary in accordance with the terms of the exchange feature The exchange may be at the option of the holder or at the option of the issuer of the securities
A listed issuer that has satisfied listing requirements as outlined in Section 502 of the Listing Requirements Manual An exempt issuer is not subject to special reporting rules This status is generally reserved for senior listed issuers
Exponential moving averages place more weight upon the later moves in the time period than the earlier moves We use exponential on our short-term moving averages 10 and 18 as we are using them as indicators for short term plays and want to see the latest trend in movement the best we can It is also known as exponentially weighted moving average
Trades executed outside normal market hours
A dividenddistribution paid in addition to the regularly established dividenddistribution of the issuer Like all dividendsdistributions it may be paid in securities or cash and the amount payable date and record date are established by the issuer The exchange that the issue is listed on sets the ex-dividenddistribution ex-d date for entitlement Extra dividendsdistributions are sometimes referred to as special dividendsdistributions
Charges for items that are both unusual in nature and infrequent in occurrence such as earthquake-related losses
The cash denomination of the individual debt instrument It is the amount of money that the holder of a debt instrument receives back from the issuer on the debt instruments maturity date Face value is also referred to as par value or principal
The true value of a stock based on criteria of the users choosing A stock is said to be overvalued when the share price exceeds the fair value
An IPO trading below its issue price in the aftermarket

Federal Reserve Board
A disclosure document submitted by a listed company to outline material changes in its affairs Filing statements are not used for the purposes of a financing
A tradable limit order marked FOK will trade as much stock as possible upon entry but will immediately cancel or kill any unfilled volume
The leverage ratio which is total assets divided by shareholders equity is an all-purpose debt gauge A company with no debt would have a ratio of one and the higher the ratio the more debt
Financial statements including operating statement balance sheet and statement of cash flows
The last price multiplied by the number of outstanding shares
A security whose interest rate or dividend changes with specified market indicators A floating rate is one that is based on an administered rate such as a prime rate
The dollar value of flow-through shares issued in accordance with a TSX or TSX Venture Exchange approved transaction The price is determined by the policies of the TSX Company Manual or TSX Venture Corporate Finance Manual the price is not adjusted for the value of the flow-through tax benefit available to the security holder It can be an initial public offering IPO secondary offering or private placement
A flying plateau is a pattern that forms after a stock has made a strong move up Strong stocks will consolidate gains sometimes in a flat sideways pattern in a tight range instead of selling back This is a very bullish pattern especially if it is formed on low volume Picture a 45 degree rise and then a move sideways for several sessions Strong stocks tend to rest in these patterns and then start another leg up
Operating cash flow minus amounts spent on plants and equipment and minus dividends
An interruption in trading on a stock triggered when an order violates parameters set by TSX
Frequency refers to the given time period on an intraday daily weekly monthly quarterly or yearly perspective Typically choosing a weekly or monthly perspective when looking at several years of data makes it easier to identify long-term trends Daily charts are useful for active traders and short-term time period chartsThe Daily 1-Minute 5-Minute 15-Minute and Hourly frequency are used for intraday charts and the remaining choices are applicable to end-of-day charts This term refers to a TSX Group Historical Performance charting feature
A stockbroker offering investment advice and other services not usually offered by discount brokers
Number of shares outstanding including options granted but not yet exercised
Analyzing stocks by looking at earnings sales profit margins etc
Used instead of earnings to evaluate real estate investment trusts REITs Depreciation of real estate that was deducted from earnings is added back in to calculate FFO Any gains or losses from the sale of real estate is also removed
A private-sector index 1992100 that attempts to predict the direction of inflation over the next 6 to 12 months
A company estimates the future profitability of a trade made today and books a profit today based on the present value of those estimated future profits
Growth at a reasonable price A strategy of buying stocks whose priceearnings ratio is equal to or less than the estimated annual earnings growth rate
Accounting rules and procedures established by the Financial Accounting Standards Board an independent self-regulating organization
Mutual funds specializing in a specific geographic area such as Europe
The Global Industry Classification Standard GICS is a consistent set of global economic sector and industry definitions GICS are used to classify the constituents of many indices worldwide GICS is a four-level classification system The four levels are sector industry group industry and sub-industry Standard Poors and Morgan Stanley Capital International MSCI two providers of global indices jointly launched GICS in 1999
The term used to describe a security that is in proper form to transfer title which means that the registered owner has endorsed it To settle a sale the certificate must be surrendered on good delivery by the seller A certificate that bears a share transfer restriction will not constitute good delivery The term used to describe a security that is in proper form to transfer title which means that the registered owner has endorsed it To settle a sale the certificate must be surrendered on good delivery by the seller A certificate that bears a share transfer restriction will not constitute good delivery
Buy or sell limit order will expire at close of trading if not executed
Buy or sell limit order remains active until you cancel it
An order placed with a broker meaning that it is good until either filled or canceled In practice this order has to be re-confirmed twice annually
A GTC order will remain in the system until the date that it is filled or until a maximum of 90 calendar days from date of entry whichever happens first This type of order is also referred to as an open order A Participating Organization can cancel a GTC order at any time
A GTD order will remain in the system until it is either filled or until the date specified at which time it is automatically cancelled by the system This is another kind of open order A Participating Organization can cancel a GTD order at any time
The amount of a companys shareholders equity that exceeds the value of its hard assets
Gross profit divided by sales
Profit a company makes on goods and services before considering overhead expenses Gross profit is sales minus cost of sales
The shares of companies that have enjoyed better-than-average growth over recent years and are expected to continue their climb
Companies with consistent annual earnings and sales growth of at least 15
A deposit instrument most commonly available from trust companies or banks requiring a minimum investment at a predetermined rate of interest for a stated term such as one or five years GICs are generally non-redeemable and non-transferable before maturity
A temporary stoppage of trading of the listed securities of an issuer which may be imposed by the Exchange its agent Market Regulation Services Inc RS or voluntarily requested by the issuer Usually an issuers listed securities are halted pending a public announcement of material information about the issuer but the Exchange or RS may also impose a halt if the issuer is not in compliance with Exchange requirements or if the Exchange determines that it is in the public interest to do so
This is a reversal signature pattern It can be either negative typical head and shoulders or positive inverted head and shoulders A head and shoulders pattern is one of the more common and reliable patterns It is comprised of a rally which ends a fairly extensive advance It is followed by a reaction on less volume This is the left shoulder The head is comprised of a rally up on high volume exceeding the price of the previous rally And the head is comprised of a reaction down to the previous bottom on light volume The right shoulder is comprised of a rally up which fails to exceed the height of the head It is then followed by a reaction down If the right shoulder does not reach the height of the left shoulder this indicates that the fall could be even more severe This last reaction down should break a horizontal line drawn along the bottoms of the previous lows from the left shoulder and head This is the point in which the major decline begins The major difference between a head and shoulder top and bottom is that the bottom should have a large burst of activity on the breakout
Pledging of assets as collateral
Occurs when new securities are posted for trading and trading takes place before the closing formal original issuance of the prospectus Also known as the grey market The term is used only for listing of new securities either on a listing of a new issuer a supplemental listing or an additional listing of existing listed securities Settlement occurs on the closing of the prospectus The time from posting for trading to closing is generally within a week
A measurement of the volatility of a stock Current price rather than historical price is used Generally if the price of an option rises without a corresponding rise in the underlying equity implied volatility is considered to have risen
An order that either raises the bid price or lowers the offering price is said to be improving the market The market improves because the spread between the bid and offer decreases
An exchange-traded fixed income-like instrument consisting of a subordinated debt security and a share of common stock packaged together to form a tax-efficient delivery mechanism to distribute an issuers free cash flow to its investors Investors are paid dividends from the common share component and interest from the subordinated debt
See Operating Income
A record of a companys sales and expenses over a particular year or quarter
A security with a solid record of dividend payments and which offers a dividend yield higher than the average common stock
Also called income funds Income trusts are trusts structured to own debt and equity of an underlying entity which carries on an active business or has royalty revenues generated by the assets of an active business By owning securities or assets of an underlying business an income trust is structured to distribute cash flows typically on a monthly basis from those businesses to unit holders in a tax-efficient manner The trust structure is typically utilized by mature stable sustainable cash-generating businesses that require a limited amount of maintenance capital expenditures An income trust is an exchange-traded equity investment that is similar to a common share There are four categories of income trusts business trusts real estate investment trusts REITs energy trusts and power pipeline and utility trusts
A composite representing the value of a group of stocks
An option whose underlying security is an index An example would be the SP 100 OEX A trader can buy index options and bet on the direction of the OEX
See Exchange-Traded Fund ETF
For an issue with a committed dividenddistribution policy the indicated annual dividenddistribution IAD equals the most recent dividenddistribution multiplied by the payment frequency For example if an issuer pays 004 quarterly then the indicated rate is 004 X 4 or 016 In the case of issuers with no committed policy the IAD is obtained by adding the dividenddistribution amounts paid in the last 12-month period Indicated annual dividenddistribution is also referred to as indicated rate
A feature of Market On Close MOC a TSX electronic call market facility the Indicative Calculated Closing Price ICCP provides a preliminary indication of what the calculated closing price for a MOC security would be assuming the regular trading session had ended at the time of calculation The ICCP is calculated without reference to volatility parameters The ICCP for each MOC security will be broadcast to the trading community at 350 PM ET on each trading day 10 minutes prior to the actual Market On Close execution A key objective of broadcasting the ICCP is to provide market participants with an early indication of potentially large price movements at the close The ICCP for all MOC securities will be included in the MOC Imbalance Report that is made available on tmxmoneycom
companies in related businesses
A companys first issue of shares to the general public
Non-public information pertaining to the business affairs of a corporation that could affect the companys share price should the information be made public
All directors and senior officers of a company and those who are presumed to have access to inside information concerning the company An insider is also anyone owning more than 10 of the voting shares of a company
number of shares owned or controlled by insiders
This is trading in the shares of an entity by its directors and officers These individuals are required to disclose their trades before they happen and several services provide this information to investors It is useful though not an absolute indicator as to a stocks potential movement to know if insiders are selling or buying shares of the company they run
With respect to a corporation or other entity these are the people who have access to inside information about a company or entity that is material to the stock price For corporations they are typically the directors and senior officers of a corporation A person or entity that owns greater than ten percent 10 someone of the voting shares of a corporation is also considered an insider
Shares owned by pension funds mutual funds banks etc
Soft assets such as patents trademarks etc
A measure of a companys ability to pay interest on its debts operating income divided by interest expenses
An international committee comprised of members from 31 exchanges around the world including every major stock exchange Membership in the ISG allows all members to share surveillance and investigative information to ensure that each regulator has access to the necessary information to effectively regulate its marketplace The ISG promotes effective market surveillance among international exchanges and RS involvement helps ensure they are continually in touch with other regulators and part of the development of international best practices
The international standard that is used to uniquely identify securities It consists of a two-character alphabetic country code specified in ISO 6166 followed by a nine-character alphanumeric security identifier assigned by a national security numbering agency and then an ISIN check-digit
Stock trading tracked in periods shorter than one day
Raw materials work in process and finished goods that havent been shipped to customers
A person employed by an investment dealer who provides investment advice to clients and executes trades on their behalf in securities and other investment products
An organization usually a stock brokerage firm involved in taking a new company public IPO consulting on mergers and acquisitions handling corporate borrowing etc
Initial investment capital necessary for starting a business Investment capital usually consists of inventory equipment pre-opening expenses and leaseholds
A specialist in the investment industry paid by fee to provide advice and research to investors with large accounts
Securities firms that employ investment advisors to work with retail and institutional clients Investment dealers have underwriting trading and research departments
A closed-end fund that offers investors the ability to buy a security that represents a portfolio of investments with a specific investment strategy These products use funds raised through a public offering to invest in a portfolio of securities which are actively managed to create income streams for investors typically through a combination of dividends capital gains interest payments and in some cases income from derivative investment strategies These funds are not directly related to an operating business Some examples are funds of income funds senior loan funds mortgage-backed security funds and commodity funds
A corporate function combining finance marketing and communications to provide investors with accurate information about a companys performance and prospects
The dollar value of initial public offering IPO securities issued in accordance with a TSX or TSX Venture Exchange approved transaction It is the stated prospectus price multiplied by the number of securities issued under the IPO plus the over allotment
Any of a companys securities or the act of distributing the securities Issued shares refer to the portion of a companys shares that have been issued for sale A company does not have to issue the total number of its authorized shares
The trading status of a class or series of an issuers listed securities such that a class or series of listed securities of an issuer may be halted suspended or delisted from trading
Commonly refers to the situation where the number of issued securities equals the number of outstanding securities However under certain corporate statutes in Canada an issuer may have issued securities and then repurchased those securities without cancelling them In that case the securities are issued but are not outstanding As a result the number of issued securities does not equal the number of outstanding securities
The trading status of a listed or formerly listed issuer Issuer status types include delisted listed suspended and trading
The execution and clearing of orders by one member of a stock exchange for the account of another member For example investment dealer A is a small firm whose volume of business is not sufficient to maintain a trader on the exchange Instead investment dealer A gives its orders to investment dealer B a larger organization which is a member of the exchange for execution Investment dealer A pays a reduced percentage of the normal commission
A young company in the early stages of operations and growth
Corporate bonds with poor credit ratings
Company with market capitalization greater than 8 billion
For a Market On Close MOC-eligible security the last sale price equals the calculated closing price If the MOC closing price acceptance parameters are exceeded it equals the last board lot sale price of the security on the exchange in the regular trading sessionFor any other listed security the last sale price equals the last board lot sale price of the security on the exchange in the regular trading session
A long-term put or call option as long as three years
LEAPS are stock options that have expiration dates that extend beyond one year
Take over of a public corporation using borrowed funds
The debts and obligations of a company or an individual Current liabilities are debts due and payable within one year Long-term liabilities are those payable after one year Liabilities are found on a companys balance sheet or an individuals net worth statement
An order to buy or sell stock at a specified price The order can be executed only at the specified price or better A limit order sets the maximum price the client is willing to pay as a buyer and the minimum price they are willing to accept as a seller
An order to close out an existing open futures or options contract A liquidating order involves the sale of a contract that has been purchased or purchase of a contract that has been sold
a measure of the number of shares or dollar value of shares traded daily Mutual funds and other institutional buyers prefer high liquidity stocks so they can easily move in and out of positions
Shares of an issuer that are traded on a stock exchange Issuers pay fees to the exchange to be listed and must abide by the rules and regulations set out by the exchange to maintain listing privileges
The document that an issuer completes and submits to an exchange when it applies to list its shares on the exchange The issuer must disclose its activities plans management and finances in the application
Time after IPO typically 180 days when insiders are prohibited from selling their shares
A long tail means the low for the day was well below the close In other words the market opened sellers took over and pushed the index down but then buyers came back in and ran the index back up to where it opened The buyers had the last say on the day and showed a lot of strength moving up That tends to show a reversal in the buying patterns and foretells a further rise from here for the short term
Balance sheet item reflecting investments in other companies etc
Margin allows investors to buy securities using borrowed money from a broker The investor is charged interest for the loan Margin requirements differ depending upon the type of transaction being made or the type of stock being purchased eg selling puts buying stock credit spreads Options are not generally marginable
This is a demand for a client to deposit money or securities into a margin account This can occur when a purchase is made in excess of the value of the margin account or when the value of an account decreases because the value of the securities held decreases regardless of whether a new purchase is made or not
The place where buyers and sellers meet to exchange goods and services It also represents the actual or potential demand for a product or service
This is a companys market capitalization To calculate the market cap simply multiply the issued and outstanding shares by the current selling price
Latest stock price multiplied by number of shares outstanding shares issued
This is a market order where the investor gives the floor trader the discretion to execute the order when he feels it is best If the floor trader feels that the market will decline he may hold the order to try to get a better fill This order may not get filled
This is an order to be executed at the market price when the market closes Institutions frequently use this method to buy or sell large numbers of shares eg when a stock is to be added or deleted from an index and the institution must buy or sell the stock for an index fund These orders are also used on day trades in order to close a position at the end of the session regardless of the price It can also be used when you want to exit a position that day but do not want to cut off a stock that is running during the day-place a market on close order and your trade will be executed at the closing price As with all market orders there is risk in that the stock that was rising and hit a target you would be happy at selling at but then falls right before the close
Similar to a real estate investment trust REIT except MLPs are not limited to a specific industry compared to REITs which must invest in real estate Both types trade like stocks on the New York Stock Exchange and both types must distribute most of their earnings in the form of dividends
A change in an issuers affairs that could have a significant effect on the market value of its securities such as a change in the nature of the business or control of the issuer Under the principle of continuous disclosure a listed issuer must issue a news release and report to the applicable self-regulatory organization as soon as a material change occurs
The average market capitalization of stocks owned by a mutual fund
See Participating Organizations POs and Members
A location on a Web site dedicated to the discussion of a particular topic usually a single stock or industry sector Discussions are not real-time Someone posts a message and then others respond over a period of hours or days
Company with market capitalization between 2 billion and 7 billion
A special term order with a minimum fill condition will only begin to trade if its first fill has the required minimum number of shares For example an order to buy 5000 shares with a minimum volume of 2000 shares can only trade if 2000 or more shares become available
These orders are guaranteed a complete fill upon entry A Registered Trader will provide the stock should the book be below the required limit To be eligible for MGF an order has to be a tradable client order with a volume less than or equal to the MGF size which varies from stock to stock
An order with a volume that combines any number of board lots and an odd lot
A strategy for selecting stocks using screening criteria that have been found to work in the past
Usually involves looking for stocks in a strong uptrend high relative strength strong earnings growth and increasing earnings forecasts In todays market may include relative strength only
Companies currently in favor by investors pricesales greater than 10 priceearnings greater than 35 or so
Part of the capital market established to buy and sell short-term financial obligations These include federal government treasury bills short-term Government of Canada bonds commercial paper bankers acceptances and guaranteed investment certificates Longer-term securities are also traded in the money market when their term shortens to three years
A real estate investment trust REIT whose primary business is investing in real estate loans
As of the last date of the last reported fiscal quarter
The average closing price of a stock over a specified period For instance the 10-day MA is the average closing price for the past 10 days Stocks are said to be in an uptrend when above their MA and in a downtrend when below The most widely followed MAs are 50 days and 200 days Long-term investors tend to look at the 200-day MA while active traders are more likely to pay attention to the 50-day MA Many investors look at both As a general rule its best to avoid stocks trading below both their 50- and 200-day MAs
This is a technical indicator that measures moving average convergencedivergence and provides a measurement of the intensity of the trading of a specific stock It can provide early clues to trend continuation or reversal The MACD indicator uses three exponential moving averages a short or fast average a long or slow average and an average of the difference between the short and long averages When the MACD line is rising the implications are positive for prices If the indicator is less than zero the price is potentially bullish If the indicator is greater than zero the price is actually bullish When the MACD line is falling the implications are negative for prices If the indicator is less than zero the price is actually bearish If the indicator is greater than zero the price is potentially bearishThe signal line can be used to determine the entry or exit point The signal line is a moving average of the MACD line When signal line crosses MACD line and both lines are up it is a buy signal When signal line crosses MACD line and both lines are down it is a sell signal
When two or more indicators indexes or averages fail to show confirming trends
A disclosure system that facilitates certain Canadian-US cross-border securities offerings issuer bids and takeover bids It is intended to reduce costly duplication of disclosure requirements and other filings when issuers from one country register securities offerings in the other Under the rules eligible cross-border offerings are governed by the disclosure requirements of the issuers home country
Orders placed before the market opens to buy or sell shares of stocks when their options expire These orders are guaranteed a complete fill at the opening price to offset expiring options They must be ordered between 415 pm and 500 pm on the Thursday before the third Friday of each month
A seller of an option contract who does not own a position in the underlying security
The difference between the previous days closing price and the last traded price
The difference between a companys or individuals total assets and its total liabilities Also known as shareholders equity for a company
Occurs concurrently with the posting of the new issuers securities for trading The preconditions for listing include the acceptance by the Exchange that all listing requirements and conditions have been satisfied The effective listing date is the date when the listed securities open for trading
An IPO initial public offering is an issuers first offering of its securities made to the public in accordance with a prospectus The offering is often made in conjunction with an issuers initial application for listing on an exchange
An issuer listing as a result of a plan of arrangement A plan of arrangement is a form of corporate reorganization that must be approved by a court and by the corporations shareholders or others affected by the proposed arrangement all as prescribed by corporate legislation A plan of arrangement can take various forms includingAn amalgamation of two or more corporations A division of the business of the corporation A transfer of all or substantially all of the property of the corporation to another corporation An exchange of securities of the corporation held by security holders of the corporation for other securities money or other property that is not a takeover bid A liquidation or dissolution of the corporation A compromise between the corporation and its creditors or holders of its debt Any combination of the foregoing
A reorganization that usually results in a newly listed issuer acquiring a business division or assets as its principal operating asset from another issuer the reorganized issuer with security holders of the reorganized issuer holding securities in both issuers following completion of the reorganization
A security issue that is newly added to the list of tradable security issues of an exchange It is accompanied with a new listing date
An issue that is recorded on the transfer agents electronic book rather than being held as a physical note
A listed issuer that is subject to special reporting rules
A special-term order when there is a clear understanding between the buying and selling parties that they will settle the trade directly with each other
Expenses not due to basic business of company
Income not derived from basic business of company
A special term order when one or more participants in the trade is not a Canadian resident
Profits a company can be expected to achieve taking out cyclical effects and unusual events such as one-time write-offs caused by late product releases customer bankruptcies and the like
A block of stock consisting of less than 100 shares When odd lots trade a premium is usually tacked on by the specialist or market maker These receive the least favorable price and trade last
A special-term order placed with the intention of trading at a later date when the price of the stock reaches the specified stop price An on-stop order becomes a limit order once a trade at the trigger price has occurred
A market that has only buy orders or only sell orders booked for a particular security
The government agency that administers the Securities Act Ontario and the Commodity Futures Act Ontario and regulates securities and listed futures contract transactions in Ontario
This is the price at which a security opens for the trading day A stock can open at the previous closing price gap up or gap down
Investors buy shares directly from fund and sell shares directly to fund Share price is Net Asset Value NAV
An order that remains in the system for more than a day See Good-Till-Cancelled or Good-Till-Date
An investment fund that continuously offers its securities to investors and stands ready to redeem its securities at all times Transactions in sharesunits of mutual funds are based on their net asset value NAV determined at the close of each business day Examples of an open-end fund are traditional mutual funds and exchange-traded funds ETFs
The market opens at 930 am ET each business day
Surplus cash generated from companys basic operations without regard to income tax entries such as depreciation and amortization Changes in levels of inventories accounts receivable and accounts payable also affect cash flow Also see Free Cash Flow
Not the same as operating income See pro forma earnings
Sales minus all expenses except income taxes and other items not related to basic business
Operating income divided by sales
All options of the same type either calls or puts that have the same underlying security
A set pattern of months when a class of options expires
The buyer of an option contract who has the right to exercise the option during its lifetime
An individual option contract for a given security
A call or put contract
An eight or nine-digit number assigned to every order entered into the system
OTC over-the-counter foreign trading refers to UMIR Rule 64 e which permits a trade to be executed off the Exchange if one or both Participating OrganizationMember client accounts are outside of Canada provided such trades are reported within a specific time frame to the Exchange for public dissemination of the transaction
Market prices that have risen too steeply and too quickly
Market prices that have declined too steeply and too quickly

This is an abbreviation of a stocks price-to-earnings ratio The price-to-earnings ratio is a stocks share price divided by earnings per share for the companys most recent four quarters A projected PE divides the share price by estimated earnings per share for the coming four quarters
A securitys nominal face value
An order receives a partial fill when it trades only part of its total committed volume
With respect to stocks split or dividends a pay date is the date that a company pays a dividend or stock split out which is usually the day before the ex-dividend date
A payment made by a market maker to a broker as a thank you for directing your stock trade to that market maker
Percentage of earnings paid out in dividends

Price to earnings ratio divided by the forecast annual earnings growth rate Traditionally stocks were said to be fairly valued when the pe and the forecast growth rate were equal
We use this with respect to options trades in determining if we like an option enough to buy it or if we are in an option if we want to stay in it This calculation tells you how far the underlying stock must move before the option will double in value We prefer a 7-10 value less if we can get it This does not mean we will not buy an option but it does give us insight as to how long we will hold it Percent to double is a Smith Barney proprietary calculation
Holdings of securities by an individual or institution A portfolio may include various types of securities representing different companies and industry sectors
The number of shares that will be outstanding after an IPO
These are a type of stock issued by a company Preferred shares give such shareholders a fixed dividend from the companys earnings Preferred shareholders also get paid before common shareholders
Debt instruments Preferred shareholders are paid ahead of common stock holders in the event the corporation is liquidated Convertible preferred shares can be converted into common stock according to predetermined conditions
A price gap describes the situation where a stock opens at a price either higher or lower than the closing price the day before This usually happens when some news affecting the value of the stock is announced after the market closes eg positive or negative earnings a buy-out etc Stocks that gap at the open often move back toward the previous close before moving again but not always Strong news such as projected higher earnings from the company tend to drive the stock without the pull back
Latest share price divided by book value stated in latest report
Latest share price divided by 12-month earnings per share eps Also a measure of the markets enthusiasm for a company
Latest share price divided by 12-month sales per share
A common stocks last closing market price per share divided by the latest reported 12-month earnings per share This ratio shows you how many times the actual or anticipated annual earnings a stock is trading at
A trade when a Participating Organization is either buying from or selling to its client
If there are several orders competing for a stock at the same price a priority determines when one of these orders will be filled before any other at this price Priority is based on the time at which the order is received into the system
The private offering of a security to a small group of buyers Resale of the security is limited See Best Efforts and Bought Deal Underwriting
Earnings without considering certain expenses such as inventory write downs severance pay depreciation and amortization charges or just about anything else the company feels like excluding to make its earnings look better Also known as core earnings ongoing earnings earnings excluding special items or operating earnings
What is left over for the owners of a business after all expenses have been deducted from revenues Gross profit is the profit before corporate income taxes Net profit is the final profit of the business after taxes have been paid
Bottom line after tax earnings divided by sales
Trades based on signals from computer programs These are usually entered directly from the traders computer to the markets computer system Program trading accounts for an increasingly larger and larger portion of all trades throughout the day Additionally these large trades may be hedged by an offsetting position in index futures
A legal document describing securities being offered for sale to the public It must be prepared in accordance with provincial securities commission regulations Prospectus documents usually disclose pertinent information concerning the companys operations securities management and purpose of the offering
Material given to stockholders when the corporation solicits shareholder votes The proxy statement usually contains details on the corporations executive compensation plans
The number of issued and outstanding shares of a company excluding shares held by persons who individually or in conjunction with other persons hold 20 or more of the issuers voting securities
A push-out occurs during a stock split when new shares are forwarded to the registered holders of old share certificates without the holders having to surrender the old shares Both the old and new shares have equal value
The ratio of put trading volume divided by the call trading volume For example a putcall ratio of 074 means that for every 100 calls bought 74 puts were bought It is a contrary indicator A reading of 10 or more is very bullish as most people think the market is going down When the majority thinks the market is going to move a certain direction it usually does the opposite
Time after IPO typically 25 days when all parties involved in IPO are prohibited from commenting on the companys future prospects Analysts employed by underwriters are free to make buyholdsell recommendations after the Quiet Period expiration
Information on the last trade and current bid and asked prices Most quotes are intentionally delayed about 20 minutes
See Market Capitalization
A brisk rise in the general price level of the market or price of a stock
Stock trading price reports that have not been artificially delayed
This is the date that a stock must be in your account for you to receive a dividend The record date has nothing to do with how we trade stock splits
A security that carries a condition giving the issuer a right to call in and retire that security at a certain price and for a certain period of time
A trader employed by a securities firm who is required to maintain reasonable liquidity in securities markets by making firm bids or offers for one or more designated securities up to a specified minimum guaranteed fill
A special form of corporation that invests primarily in real estate REITs do not pay federal income taxes as long as they pay out 90 of their earnings to shareholders in the form of dividends
dividend yield of a stock compared the dividend yield of the SP 500
A TSX report that ranks each Participating OrganizationsMembers trading activity relative to the total market and the other POsMembers It is produced monthly for each TSX Group POMember
Costs of developing new products and services
This is a level where a stock has a difficult time moving through Resistance levels can be caused by former tops breakout prices moving averages or just price levels where a stock has spent a lot of time in the past When choosing buy levels we watch for a stock to break through resistance on good volume That indicates the move through the resistance is strong and that the stock will most likely stay above that resistance In such situations former resistance then becomes support When we take a position coming off of support we always look for resistance levels as points where we may encounter resistance so we do not lose gains we have banked if resistance proves too much
The Registered Trader assigned by the Selection Committee to act as market maker in a security Their duties include providing a minimum guaranteed fill maintaining minimum spread and ensuring orderly trading
A security that features an option for the holder to require the issuer to redeem it subject to specified terms and conditions
After tax income latest 12 months divided by total of shareholders equity plus long term debt plus other long term liabilities
The total amount of funds generated by a business
This is where a company reduces the number of outstanding shares by decreasing the number of available shares and combining their value into the fewer shares This has the effect of increasing the stocks par value This is often used by companies whose stock is about to be delisted from an exchange because of its low price
A transaction or series of transactions that includes a securities issuance made by a listed issuer to parties vending securities or other assets into the listed issuer the new securitys holders such that after completion of the transactions the new securitys holders will own more than 50 of the outstanding voting securities of the listed issuer with an accompanying change of control of the listed issuer A reverse takeover RTObackdoor listing can be completed through various transactions including a business or asset acquisition an amalgamation a plan of arrangement or other form of reorganization The listing of securities of an issuer formed in accordance with an RTObackdoor listing is treated as a new listing
A temporary privilege that lets shareholders purchase additional shares directly from the issuer at a stated price The price is usually less than the market price of the common shares on the day the rights are issued The rights are only valid within a given time period

Relative Strength Index is an overboughtoversold indicator that attempts to predict trend reversal points RSI is based on the observation that a stock which is advancing will tend to close nearer to the high of the day than the low The reverse is true for declining stocks This indicator can also be used when comparing two different equities on a relative basis RSIs absolute levels are 0 and 100 Buy signals are triggered at 30 and sell signals are triggered at 70 One of the important aspects of RSI is to look for divergence between price action and RSI Upward sloping price and downward sloping RSI should be taken as a warning
Services and products sold by a company Sales and revenues mean the same thing
Annual sales divided by the number of shares outstanding
Sales at retail stores or restaurants open at least one year A chains same store sales growth excludes gains due to increases in the number of stores Same store sales growth in the 5 percent to 10 percent range is considered good
Searching the entire universe of mutual funds or stocks meeting user-specified criteria
The traditional term for membership on a stock exchange An investment dealer or brokerage buys a seat on the exchange and one employee is designated as the seat holder As Toronto Stock Exchange is now demutualized there are no longer seats on the exchange
The dollar value of secondary offering securities issued in accordance with a TSX or TSX Venture Exchange approved transaction It is the stated prospectus price multiplied by the number of securities issued under the offering plus the over allotment
mutual funds specializing in a particular industry sector such as computers or health care
Transferable certificates of ownership of investment products such as notes bonds stocks futures contracts and options
Each province has a securities commission or administrator that oversees the provincial securities act This act is a set of laws and regulations that set down the rules under which securities may be issued or traded in that province
The shares or stock sold by a company to provide start-up capital before carrying out an initial public offering IPO
An analyst employed by a brokerage house such as Merrill Lynch
The date when a securities buyer must pay for a purchase or a seller must deliver the securities sold Settlement must be made on or before the third business day following the transaction date in most cases
A paper certificate that represents the number of shares an investor owns
The difference between the total of assets and liabilities shown on a companys balance sheet Book value is the shareholders equity divided by the number of outstanding shares
The total number of shares issued by a corporation
This is a condition resulting from selling an option and not owning the related securities
Selling stock you dont own You hope it drops in price so you can buy it back later at a lower price You must have a margin account with your broker to sell short
A short sale squeeze occurs when there are many short sale positions on a stock the stock begins to increase As the stock price rises the short sellers scramble to cover their short positions ie buying the stock they have sold back This creates demand for the stock above that which caused the stock price to start rising in the first place and can lead to rapid price appreciation
The selling of a security that the seller does not own naked or uncovered short or has borrowed covered short Short selling is a trading strategy Short sellers assume the risk that they will be able to buy the stock at a lower price cover the outstanding short and realize a profit from the difference
A sharp move up in stock price forcing short sellers to liquidate their positions
Borrowings that must be repaid within one-year
Stocks and other liquid securities
This is the average stock price over a certain period of time
Company with market capitalization less than 1 billion
Orders which must trade under special conditions For example a cash order will be settled sooner than the usual three-day settlement period
A session during which trading in a listed security is limited to the execution of transactions at a single price
Someone prepared to accept calculated risks in the marketplace for attractive potential returns
Capital and preferred shares issued by a split-share corporation A split-share corporation holds common shares of one or more companies The corporation then issues two classes of shares - capital shares and preferred shares The objective is to generate fixed cumulative preferential dividends for the holders of preferred shares and to enable the holders of the capital shares to participate in any capital appreciation or depreciation in the underlying common shares
The spread is the gap between bid and ask prices of a stock option or other security This term is also used to generally describe a number of strategies that make use of different spreads between calls puts and the underlying stock eg Bull Spread with Calls Bull Spread with Puts Bear Spread with Puts Bear Spread with Calls Butterfly Spread Calendar Spread Ratio Call Spread
Committees formed for the purpose of assisting in decision-making on an ongoing basis
A dividenddistribution paid in securities of the same issue or a different issue of the same issuer or another issuer A stock dividenddistribution can be used as a means to list a new issuer The issuer or its representative provides the amount payable date and record date The exchange that the issue is listed on sets the ex-dividenddistribution ex-d date for entitlement
Futures contracts which have a stock index as the underlying interest
A security issue that is removed or delisted from the list of tradable security issues of an exchange It is usually accompanied with a reason for deletion and the deletion date
A statistical measure of the state of the stock market based on the performance of certain stocks Examples include the SPTSX Composite Index and the SPTSX Venture Composite Index
A corporate action that increases the number of securities issued and outstanding without the issuer receiving any consideration for the issue Approval by security holders is required in many jurisdictions Each security holder gets more securities in direct proportion to the amount of securities they own on the record date thus their percentage ownership of the issuer does not change For example a two-for-one stock split involves the issuance of two new securities for every old security
A one-character to three-character alphabetic root symbol which represents an issuer listed on Toronto Stock Exchange or TSX Venture Exchange
The character or characters that may follow the stock symbol to uniquely identify a listed security It can be a single alphabetic character two alphabetic characters or a combination of two plus one characters with a maximum of eight characters for the stock symbol extension and separator dots in between For example BMOPRU Currently they include A-B - class of shares B - debentureE - equity dividendH - NEX marketIR - installment receiptsNO NS NT - notesP - Capital Pool CompanyPR - preferredR - subscription receiptsRT - rightsS - special US termsU V - US fundsUN - units W - when issued WT - warrants
An order placed which is not at the current market price It becomes a market order once the security touches the specified price Buy stop orders are placed above the present market price Sell stop orders are placed below the present market price also known as a stop loss If a stock gaps past the stop order it becomes a market order and is filled at the next trading price
Order with broker to sell stock at market price when it goes down to specified limit price
These are certificates registered in the name of a securities firm rather than the owner of the security This makes the certificate easily transferable to a new owner
Closed-end or open-end investment funds which provide innovative and flexible investment products designed to respond to modern investor needs such as yield enhancement risk reduction or asset diversification Structured products allow investors to buy a single unitshare of a fund that represents an interest in the investment portfolio Based on the investment strategy the portfolio can purchase a basket of securities track an index or hold a specific type of security or portion of a securityThe subcategories under the structured products include investment funds ETFs capital trusts split share corporations and mutual fund partnerships
A broad category of transactions that involves one security on the stock list being replaced by another security or securities
A type of listing transaction made after an issuers original listing that involves the listing and posting for trading of a new issue of securities Typically this involves the listing of preferred shares rights warrants or debentures Supplemental also covers the additional listing of when-issued shares through a secondary offering of an issue that is already listed
Support levels are levels where a declining stock will find bottom and bounce up from Supports are formed when a stock breaks above resistance and holds above that level the old resistance then becomes support Support levels are also formed when a stock spends a lot of time at one level and then breaks upward The level that the stock spent most of the time at will most likely act as support Key moving averages such as the 18 50 and 200 also act as support We like to buy stocks as they bounce upward off of support levels and are backed by good money flow and buying
Difference between reported earnings and analysts consensus forecasts Its a positive surprise if reported earnings exceed forecasts and a negative surprise when reported earnings come in below forecasts
The status of a listed security of an issuer whose trading privileges have been revoked by the Exchange All securities of the issuer remain suspended until trading privileges have been reinstated or the issuer is delisted
Movement of funds from a non interest-bearing account to an interest bearing account
A change in a listed issuers stock symbol which may be required by the Exchange in the context of an issuers reorganization or may be made at the request of the issuer A requested symbol is available for use if it is appropriate for the type of security and the issuers voting structure
Book Value minus goodwill and intangible assets
The study and use of price and volume charts and other technical indicators to make trading decisions Technical analysis attempts to use past stock price and volume information to predict future price movements Fundamentally technical analysis shows in graphic form investor sentiment both greed and fear Understanding that concept is key to understanding technical analysis and being able to use it effectively to trade securities With proper technical analysis you can be ready for certain moves and when your analysis is confirmed by the actual start of the move trading positions can be taken Technical analysis can be used for short-term trading or long-term position buying We use if for both and the two are closely related
A market that occurs when there are comparatively few bids to buy or offers to sell or both The phrase may apply to a single security or to the entire stock market In a thin market price fluctuations between transactions are usually larger than when the market is liquid A thin market in a particular stock may reflect lack of interest in that issue or a limited supply of the stock
Slang used for minimum spread Depending on the stock price it could be a half-cent one cent or five cents
Each time a stock is bought and sold it is displayed on an electronic ticker tape It is a record of current trading activity on an exchange
The administrative fee charged for each trade
TSV is a technical indicator that examines a stocks volume and price and compares them to determine if a stock is under accumulation buying or distribution selling If TSV is moving up this can indicate that price may follow
This policy requires all listed companies to publicly disclose material information in a timely manner
These are phrases used in placing orders to either buy or sell securities If you are placing an order to purchase ten contracts of Dell October 40 calls at a limit of 4 58 for the day you would tell your broker you were placing a day order for 10 contracts of Dell October 40 strike calls to buy at a limit of 4 58 This gives your broker all the information he or she needs to place the order

A charting term meaning the stock price is going down from here
Sales or revenues
The total number of issued and outstanding shares for the security
Similar to the stock price index value SPIV except that the TRIV is based on the aggregate float quoted market value of the index constituents SPIV plus their paid dividendsdistributions TRIV is calculated only at the end of the trading session for all SPTSX indices
A trading halt is imposed by the exchange usually due to the dissemination of news that might impact a stocks price
The status of a listed security of an issuer whose trading privileges are active on the Exchange
The unique 3-digit number assigned to each Participating Organization and Member to identify it for market transparency
A trading range occurs when a stock or average moves up and down between a consistent high and low for an extended period of time days to weeks to months The bottom of the range becomes fairly solid support as the top becomes fairly solid resistance the more times either holds We play stocks within the trading ranges if they are loose enough to give us some room to maneuver eg a 5 point range or more A tight trading range is one that is significantly narrower than a particular stocks usual trading fluctuations A tight trading range on low volume is usually a very good indicator that a move up is coming
The period during which the Exchange is open for trading
The last four reported quarters
The date when the purchase or sale of a security takes place
As reported in exchange trading statistics represents the total number of trades for a specified period
A trust company appointed by a listed company to keep a record of the names addresses and number of shares held by its shareholders Frequently the transfer agent also distributes dividend cheques to the companys shareholders
A security that can be transferred from one party holder to another without restrictions provided that all proper documentation is included
These are lines both up and down that are formed by a stocks price movement In the simplest sense trend lines are drawn between a stocks successive lows to find support and successive highs to find resistance The more times a stocks price touches a trendline and holds the better an indicator it is Trend lines can be long term and short term and as noted can be used to determine support and resistance We often use trendlines to help determine when we should enter of exit trades When we are in positions and following the trend we do not like to see the stock break its trend for greater than one day If a stock does that it has changed its character and the trendline is most likely no longer in force
Price moves in a single direction and it usually closes on an extreme for the day
the third Friday of March June September and December is the day when index futures index future options and certain stock options all expire Triple Witching Fridays are know for high volatility
The specific security commodity index or financial instrument that an option or futures contract is traded
A stock trading below its fair value
A security not listed on a stock exchange but traded on the over-the-counter market
This occurs when a stock has consolidated formed a base or has been in a trading range and then breaks above that level surpassing resistance at the top of the range or base Breakouts are suspect if they do not occur on high volume compared to average daily volume When playing a stock to buy on the upside breakout we like to use a buy stop which calls for purchase when a stock rises above a certain price
A stock is said to be on an uptick when the last trade occurred at a higher price than the one before it
Stock price is trending higher
One who looks for out of favor value priced stocks
Companies currently out of favor with investors These companies usually have low valuation ratios priceearnings less than the SP 500 pricesales ratio less than 2 pricebook ratio less than 2
An investor involved in financing a companys operations before going public in exchange for an ownership percentage
When the market or security tends to vary often and wildly in prices it is said to be volatile
The measurement of how much an underlying security fluctuates over a period of time
Volume is the daily number of shares of a security that are traded Volume is one of the most important indicators we watch Its relation with price movements tells us 90 of the story behind a stocks movement and future movements At its simplest increased volume on increasing prices shows accumulation Increased volume on lower prices shows distribution There are many variations on this theme and we spend a great deal of time poring over pricevolume relations to determine which way a stock will move
A group of stocks or funds that you are tracking but dont currently own
Occurs when the security has been listed and posted for trading but the certificate representing the security itself is not yet issued and available for settlement The exchange bulletin issued on listing of the security indicates if the trading will be done on a when-issued basis In this case the issuance of the security is guaranteed and the delay in issuance is often due to factors relating to the printing and distribution of the security The period for when-issued trading is usually less than one week
Analysts publish earnings forecasts for companies they follow Sometimes analysts publish a lower number than they really believe to reduce chances of a negative surprise but they supposedly whisper what they really think to their best friendsMost whisper numbers you see on the Web are simply the analysts consensus forecasts plus the average of the most recent two or three earnings surprises
Current assets minus current liabilities
To write an option is to sell an option The person who sells the option is considered to be the writer
This is the measure of the return on an investment and is shown as a percentage A stock yield is calculated by dividing the annual dividend by the stocks current market price For example a stock selling at 50 and with an annual dividend of 5 per share yields 10 A bond yield is a more complicated calculation involving annual interest payments plus amortizing the difference between its current market price and par value over the life of the bond