CSC Chapter 2

An investment dealer operates as an agent
when it acts on behalf of a buyer or a seller
of a security and does not itself own title to
the securities at any time during the
transactions. See also Principal.

Shares in closed-end investment companies
are readily transferable in the open market
and are bought and sold like other shares.
Capitalization is fixed. See also Investment
Company.

The process by which insurance companies,
owned by policy holders, reorganize into
companies owned by shareholders. Policy
holders become shareholders in an insurance
company.

The original sale of any issue of a company’s
securities.

The person for whom a broker executes an
order, or a dealer buying or selling for its
own account. The term may also refer to a
person’s capital or to the face amount of a
bond.

Insurance companies sell these funds as an
alternative to conventional mutual funds.
Like mutual funds, segregated funds offer a
range of investment objectives and
categories of securities e.g. equity funds,
bond funds, balanced funds etc. These
funds have the unique feature of
guaranteeing that, regardless of how poorly
the fund performs, at least a minimum
percentage (usually 75% or more) of the
investor’s payments into the fund will be
returned when the fund matures.

An organization recognized by the
Securities Administrators as having powers
to establish and enforce industry regulations
to protect investors and to maintain fair,
equitable, and ethical practices in the
industry and ensure conformity with
securities legislation. Canadian SROs
include the Investment Industry
Regulatory Organization of Canada, the
Mutual Fund Dealers Association, the
Montréal Exchange, the Toronto Stock
Exchange, the TSX Venture Exchange and
ICE Futures Canada.

The purchase for resale of a security issue
by one or more investment dealers or
underwriters. The formal agreements
pertaining to such a transaction are called
underwriting agreements.