CSC Chapter 2: The Capital Market

Canadian Unlisted Board

The Ontario web-based system to which the trades of unlisted securities are reported.

primary market

The market where newly issued securities are sold by companies and governments to investors.

alternative trading system

Privately-owned computerized networks that match orders for securities outside of recognized exchange facilities. Also referred to as Proprietary Electronic Trading Systems (PETS).

Montréal Exchange

An exchange that deals exclusively with non-agricultural options and futures in Canada.

auction market

Market in which securities are bought and sold by brokers acting as agents for their clients.

Toronto Stock Exchange

The largest stock exchange in Canada with over 1,700 companies listed on the exchange.

stock exchange

An auction market where byers and sellers of securities meet to trade based on the laws of supply and demand.

investment advisor

An individual licensed to transact in the full range of securities. The term refers to employees of CIRO member firms only. Also known as a Registrant or Registered Representative (RR).

common share

Securities representing ownership in a company. They carry voting privileges and are entitled to the receipt of dividends, if declared.

bid price

The highest price a buyer is willing to pay for the financial instrument being quoted.

institutional investor

Organizations, such as pension and mutual fund companies, that trade in large-share quantities or dollar amounts.

dealer market

Also referred to as the unlisted market. Securities are bought and sold over-the-counter with dealers acting as principals when buying and selling securities for clients.

ask price

The lowest price a seller will accept for the financial instrument being quoted.

money market

That part of the capital market in which short-term financial obligations are bought and sold.

liquidity

The ability of the market for a particular security to absorb a reasonable amount of buying or selling at reasonable price changes.

secondary market

The market where investors trade securities that have already been issued.

bid-ask spread

The difference between the bid price and ask price.

TSX Venture Exchange

Canada’s public venture marketplace, the result of the merger of the Vancouver and Alberta Stock Exchanges in 1999.