In order to achieve success in the stock market you must be able to speak the language of the stock market. Please use our supplied glossary of terms to become better acquainted with these terms so that you may gain a better understanding of the market world
Energy or Royalty Trust
Investment vehicles that may engage in the development, acquisition, and/or 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.
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.
Exchange Offering Prospectus (EOP)
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 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.
Exchange-Traded Fund (ETF)
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).
Ex-dividend/distribution date. The date that the buyer of a stock is not entitled to the upcoming declared dividend/distribution, 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.
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.
The act of an option holder who chooses to take delivery (calls) or make delivery (puts) of the underlying interest against payment of the exercise price.
The date at which an option contract expires. This means that the option can’t be exercised after that date.
Extra Dividend / Distribution
A dividend/distribution paid in addition to the regularly established dividend/distribution of the issuer. Like all dividends/distributions, 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-dividend/distribution (ex-d) date for entitlement. Extra dividends/distributions are sometimes referred to as special dividends/distributions.