Terms & Definitions - B
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Back-end load: A sales charge levied when mutual fund units are redeemed.
Balance sheet: A financial statement showing the nature and amount of a company's assets, liabilities and shareholders' equity.
Balanced fund: A mutual fund that invests in a balanced portfolio, including interest-bearing securities, such as bonds and mortgages, and equity investments, such as preferred and common shares.
Bank Rate: The rate at which the Bank of Canada makes short-term loans to chartered banks and other financial institutions, and the benchmark for prime rates set by financial institutions.
Bankers' Acceptance: Short-term bank paper with the repayment of principal and payment of interest guaranteed by the issuer's bank.
Bear market: A declining financial market. A steadily falling stock market. A "bear" is a person who believes the market will drop.
Beta: A statistical term used to illustrate the relationship of the price of an individual security or mutual fund unit to similar securities or financial market indexes.
Bid price: A proposal to buy a specific quantity of securities at a named price.
Blue chip stocks: Shares of large, well known, established corporations with a history of good earnings and/or dividend payments.
Board lot: A standard number of shares for trading transactions. The number of shares in a board lot varies with the price level of the security, although in most cases a board lot is 100 shares.
Board of directors: A committee elected by the shareholders of a company, empowered to act on their behalf in the management of company affairs. Directors are normally elected each year at the annual meeting.
Bond fund: A mutual fund that invests in a widely diversified portfolio of bonds with varying maturities. A bond fund usually holds bonds issued by governments as well as by major corporations.
Bonds: Bonds are certificates through which governments and large corporations borrow money. They promise to pay the holder a fixed annual rate of interest for a specified term, and to repay the principal at maturity.
Book value: The value of net assets that belong to a company's shareholders, as stated on the balance sheet.
Bridge payment: An early retirement pension benefit provided to workers under some employer plans, especially in the public sector. Bridge payments give workers extra money as a “bridge” until they can begin collecting full Canada Pension Plan payments at age 65. The payments are intended to approximate the amount of CPP benefit an employee will be entitled to earn at 65.
Broker: An agent who handles the public's orders to buy and sell securities, commodities, or other property. A commission is generally charged for this service.
Bull market: A steadily climbing stock market. A "bull" is a person who believes the market will rise.
Buying on margin: Purchasing a security partly with borrowed money.
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