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Definition of savings funds
Mutual funds that seek to preserve capital. This type of fund invests primarily in short-term securities with an average term to maturity of one year or less, or in the case of money market funds, 90 days or less.
The measure of a fund's or stocks risk in relation to the market. A beta of 0.7 means
The beta of a fund is determined as follows:
Interest rate associated with borrowing money.
Indicated yield represents return on a share of a mutual fund held over the past 12
Investment funds established for the support of institutions such as colleges, private
Non-interest bearing deposits held in reserve for depository institutions at their district Federal
The market where banks can borrow or lend reserves, allowing banks temporarily
This is the interest rate that banks with excess reserves at a Federal Reserve district bank
Fed funds traded for future delivery.
Used by real estate and other investment trusts to define the cash flow from
National- or state-chartered institution that accepts savings deposits and
Accounts that pay interest, typically at below-market interest rates, that do not have a
Cash flow available after payment of taxes in the project.
Fed funds sold for a period of time longer than overnight.
Mutual funds that do not charge an upfront or back-end commission, but instead take out up to
The capital invested in a business by the shareholders, including retained profits.
internally generated funds
Cash reinvested in the firm; depreciation plus earnings not paid out as dividends.
Federal Funds Rate
The interest rate at which banks lend deposits at the Federal Reserve to one another overnight.
Savings Incentive Match Plan for Employees (SIMPLE)
An IRA set up by an employer with no other retirement plan and employing fewer than 100 employees,
Registered Retirement Savings Plan (Canada)
Commonly referred to as an RRSP, this is a tax sheltered and tax deferred savings plan recognized by the Federal and Provincial tax authorities, whereby deposits are fully tax deductable in the year of deposit and fully taxable in the year of receipt. The ability to defer taxes on RRSP earnings allows one to save much faster than is ordinarily possible. The new rules which apply to RRSP's are that the holder of such a plan must convert it into income by the end of the year in which the holder turns age 69. The choices for conversion are to simply cash it in an pay full tax in the year of receipt, convert it to a RRIF and take a varying stream of income, paying tax on the amount received annually until the income is exhausted, or converting it into an annuity with guaranteed payments for a chosen number of years, again paying tax each year on moneys received.
Spousal Registered Retirement Savings Plan
This is an RRSP owned by the spouse of the person contributing to it. The contributor can direct up to 100% of eligible RRSP deposits into a spousal RRSP each and every year. Contributing to a spouses RRSP reduces the amount one can contribute to one's own RRSP, however, if the spouse is a lower income earner, it is an excellent way in which to split income for lower taxation in retirement years.
Labour-Sponsored Venture Funds
Venture capital corporations established by labour unions. They function as other venture capital corporations but are subject to government regulation.
Canada Savings Bonds
A bond issued each year by the federal government. These bonds can be cashed in at any time for their full face value.
EFT (electronic funds transfer)
funds which are electronically credited to your account (e.g. direct deposit), or electronically debited from your account on an ongoing basis (e.g. a pre-authorized monthly bill payment, or a monthly loan or mortgage payment). A wire transfer is a form of EFT.
Mutual funds that seek long-term capital growth. This type of fund invests primarily in equity securities.
Mutual funds that seek regular income. This type of fund invests primarily in government, corporate and other types of bonds, debt securities, and other income producing securities and in certain circumstances can also hold common and preferred shares.
Mutual funds that aim to track the performance of a specific stock or bond index. This process is also referred to as indexing and passive management.
NSF (non-sufficient funds)
This appears on your statement if there are insufficient funds in your account to cover a cheque that you have written or a pre-authorized payment that you have already arranged. You will be charged a service fee for non-sufficient funds.
RRSP (Registered Retirement Savings Plan) (Canada)
A savings plan registered with Revenue Canada, which allows you to set aside a portion of your earned income now for use in the future. When you contribute to your RRSP, you are eligible to claim a tax deduction. However, cashing RRSPs at a later date will result in the payment of tax.
M1-A: Currency plus demand deposits
The market in which savings are made available to those needing funds to undertake investment projects. A financial market in which longer-term (maturity greater than one year) bonds and stocks are traded.
Canadian Deposit Insurance Corporation
Better known as CDIC, this is an organization which insures qualifying deposits and GICs at savings institutions, mainly banks and trust companys, which belong to the CDIC for amounts up to $60,000 and for terms of up to five years. Many types of deposits are not insured, such as mortgage-backed deposits, annuities of duration of more than five years, and mutual funds.
Life Income Fund
Commonly known as a LIF, this is one of the options available to locked in Registered Pension Plan (RPP) holders for income payout as opposed to Registered Retirement savings Plan (RRSP) holders choice of payout through Registered Retirement Income funds (RRIF). A LIF must be converted to a unisex annuity by the time the holder reaches age 80.
qualified investments (Canada)
Qualified investments is the term used for investments that can be held in an RSP. These investments generally include:
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