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Accrued Interest

Interest that has accumulated on an investment but has not yet been paid. Accrued interest is often factored into the price if you buy or sell an investment before it matures.

Acquisition

The process of acquiring an asset (e.g. one firm or company buying another firm or company).

Against the Box

A term used for a short sale if the investor is also long the stock. Box is an old term that refers to the physical location of the stock certificate in a security box.

All or None (AON)

Marked on a buy or sell order to signify that no partial transaction is to be executed.

Alpha

A coefficient measuring the risk adjusted performance, considering the risk due to the specific security, rather than the overall market.

American Depository Receipt (ADR)

A security created by a U.S. bank that evidences ownership of a specified number of shares of a foreign security held in a depository in the issuing company's country of domicile. The certificate, transfer and settlement practices for ADRs are identical to those for U.S. securities. U.S. investors often prefer ADRs to direct purchase of foreign shares because of the ready availability of price information, lower transaction costs and timely dividend distribution.

American Option

Options that can be exercised at any time during the life of the option.

AMEX

The American Stock Exchange (AMEX) is the second largest U.S. floor based stock exchange behind the NYSE. The AMEX trades in mostly small to medium sized companies.

Annual Report

The formal report on a company's finances and operations sent to all owners of shares in the company. It discloses the company's business activity during the year.

Annuity

A contract generally sold by life insurance companies that guarantees an income to the purchaser (or "annuitant") at some point in the future.

Arbitrage

The simultaneous purchase of a security on one exchange, while selling the same security on a different exchange to yield a profit.

Arrears

Money that was not paid when it was due, and which is still owing. Most commonly referred to in the context of dividends.

Ask

The price at which someone who owns a security offers to sell it; also known as the "asked price" or "offer price".

Asset Mix

Assets are distributed among stocks, bonds, and money-market instruments (Treasury Bills, Guaranteed Income Certificates, short-term government bonds, and commercial paper).

Assets

Everything you, or a company, owns or are owed. Any possessions that have value in an exchange.

Assignment

In the context of options, the receipt of an exercise notice by an options writer that requires the sale (in the case of a call) or purchase (in the case of a put) of the underlying security at the specified strike price.

At-the-Money

A term to describe an option with a strike price equal to the underlying security's market value.

Averaging Down

The process of buying more of a security at a lower price then paid for the initial investment. The goal is to reduce the average cost per unit of the security.

Average Maturity

The average time to maturity of securities held by a mutual fund. Changes in interest rates have a greater impact on income funds with longer average life.

Averages and Indexes

Statistics that are used to measure the performance of a stock market or the broader economy. They are based on the performance of a basket of stocks or other indicators. Examples include the Dow Jones Industrial Average (DJIA) and the S&P/TSX Composite Index.