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
S&P/TSX 60 Capped Index
Includes all of the constituents of the S&P/TSX 60 Index. The relative weight by market capitalization of any single index constituent is capped at 10%.
S&P/TSX 60 Index
An index of large, liquid, Canadian issuers listed on Toronto Stock Exchange. It is market capitalization weighted, with weights adjusted for available share float, and includes securities of 60 issuers balanced across ten economic sectors. Inclusion in the S&P/TSX Composite is a prerequisite to inclusion in the S&P/TSX 60 Index.
S&P/TSX Capped Composite Index
Includes all of the constituents of the S&P/TSX Composite Index. The relative weight by market capitalization of any single index constituent is capped at 10%.
S&P/TSX Composite Index
Comprises the majority of market capitalization for Canadian-based, Toronto Stock Exchange listed companies. It is the leading benchmark used to measure the price performance of the broad, Canadian, senior equity market. It was formerly known as the TSE 300 Composite Index.
S&P/TSX MidCap Index
An index of mid-sized Canadian issuers that have been included in the S&P/TSX Composite Index but are not members of the S&P/TSX 60 Index. It is market capitalization weighted, with weights adjusted for available share float, and includes securities of 60 issuers balanced across ten economic sectors.
S&P/TSX SmallCap Index
An index of smaller Canadian issuers that are included in the S&P/TSX Composite Index, but have not been added to the S&P/TSX 60 Index or the S&P/TSX MidCap Index. When a new issuer qualifies to be included in the S&P/TSX Composite, it is automatically added to the S&P/TSX SmallCap Index. This index does not have a fixed number of constituents.
S&P/TSX Venture Composite Index
Launched December 10, 2001, it is the leading benchmark used to measure the price performance of the Canadian public venture capital equity market.
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.
Secondary Offering Financing
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”.
Transferable certificates of ownership of investment products such as notes, bonds, stocks, futures contracts and options.
Securities and Exchange Commission (SEC)
The federal regulatory body for interstate securities transactions in the United States.
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.
Securities Industry Association (SIA)
The trade association representing more than 600 securities firms throughout Canada and the United States. Members include banks, brokers, dealers and mutual fund companies.
The System for Electronic Document Analysis and Retrieval. SEDAR is an electronic filing system that allows listed companies to file prospectuses and continuous disclosure documents. The Canadian Securities Administrators, Canadian Depository for Securities Limited and the filing community developed it, with co-operation from legal firms and stock exchanges. SEDAR is a trademark of the Canadian Securities Administrators.
The shares or stock sold by a company to provide start-up capital before carrying out an initial public offering IPO.
An organization recognized by securities administrators as having powers to establish and enforce industry regulations to protect investors and to maintain fair, equitable and ethical practices in the securities industry. Examples include Toronto Stock Exchange and the Investment Dealers Association.
The process that follows a transaction when the seller delivers the security to the buyer and the buyer pays the seller for the security.
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.
The price used to determine the daily net gains or losses in the value of an open futures or options contract.
A paper certificate that represents the number of shares an investor owns.
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.
Orders which must trade under special conditions. For example, a cash order will be settled sooner than the usual three-day settlement period.
Special Trading Session
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.
Sponsor, TSX Venture Issuers
A Participating Organization of TSX or a Member of TSX Venture Exchange that is qualified to carry out a due-diligence review of an issuer and prepare a sponsor report, which provides an opinion on the suitability of that issuer for listing or continued listing on TSX Venture Exchange.
The difference between the bid and the ask prices of a stock.
Committees formed for the purpose of assisting in decision-making on an ongoing basis.
A dividend/distribution paid in securities of the same issue or a different issue of the same issuer or another issuer. A stock dividend/distribution 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-dividend/distribution (ex-d) date for entitlement.
Stock Index Futures
Futures contracts which have a stock index as the underlying interest.
Stock List Deletion
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.
Stock Price Index
A statistical measure of the state of the stock market, based on the performance of certain stocks. Examples include the S&P/TSX Composite Index and the S&P/TSX Venture Composite Index.
Stock Price Index Value (SPIV)
The number that is usually quoted as the value of an index. SPIV is based on the aggregate, float quoted market value of the index constituents and is calculated for all S&P/TSX indices. SPIV is calculated at the end of the trading session for all S&P/TSX indices and throughout the trading session for certain S&P/TSX indices.
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.
Stock Symbol Extension
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, BMO.PR.U. Currently, they include: A-B – class of shares DB – debenture E – equity dividend H – NEX market IR – installment receipts NO, NS, NT – notes P – Capital Pool Company PR – preferred R – subscription receipts RT – rights S – special U.S. terms U, V – U.S. funds UN – units W – when issued WT – warrants
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.
The price the owner of an option can purchase or sell the underlying security. The purchases and sales are also known as calls and puts.
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 unit/share 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 security. The 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 issuer’s 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.
Supplemental Listing Financing
The dollar value of supplemental 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 supplemental listing plus the over allotment”.
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.
An issuer whose trading privileges for a listed security or securities have been revoked by Toronto Stock Exchange or TSX Venture Exchange. The listed issuer remains suspended until trading privileges have been reinstated, or the listed issuer is delisted.
A change in a listed issuer’s stock symbol, which may be required by the Exchange in the context of an issuer’s 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 issuer’s voting structure.