Stock Market Terms

Debt financing

A method of financing in which a company receives a loan and gives its promise to repay the loan but it does not give ownership

Equity financing

the act of raising money for company activities by selling common or preferred stock to individual or institutional investors.

Individual Investor

who purchases small amounts of securities for him/herself, as opposed to an institutional investor.

Institutional Investor

Is a business, they are a lot larger, with a lot more money to invest.

Limited Liability

not completely liable for losses incurred, these refer to the losses a company experiences.

Dividend

A distribution of a portion of a company's earnings, decided by the board of directors, to a class of its shareholders.

Common Stock

represent ownership in a company and a claim (dividends) on a portion of profits.

Preferred Stock

represents some degree of ownership in a company but usually doesn't come with the same voting rights.

IPO

Is the initial public offering, or the price a company offers when they first enter the public market.

Market Capitalization

The market value of a company as determined by their share price. Market capitalization is calculated by multiplying a company's shares outstanding by the current market price of one share.

Bid

An offer made by an investor, a trader or a dealer to buy a security. The bid will stipulate both the price at which the buyer is willing to purchase the security and the quantity to be purchased.

Ask

stipulates the price a seller is willing to accept for a security and the quantity of the security to be sold at that price.

Market Index

An aggregate value produced by combining several stocks or other investment vehicles together and expressing their total values against a base value from a specific date.

Bull Market

A financial market of a group of securities in which prices are rising or are expected to rise. Bull markets are characterized by optimism, investor confidence and expectations that strong results will continue.

Bear Market

A market condition in which the prices of securities are falling, and widespread pessimism causes the negative sentiment to be self-sustaining.

TSX Exchange

Canada’s senior equities market, providing domestic and international investors with access to Canada’s marketplace.

TSX Exhange operations

Issuers list a variety of securities on Toronto Stock Exchange, including conventional securities and equity-related products, including exchange traded funds, income trusts, and investment funds.