Month: December 2020

A Government-Sponsored Retirement Arrangement (GSRA) is a Canadian retirement plan for individuals who are not employees of a local, provincial or federal government body, but who are paid for their services from public funds. This type of retirement plan is not registered with the Canadian Revenue Agency and does not thus qualify for tax-deferred status.

The record date, or date of record, is the cut-off date established by a company in order to determine which shareholders are eligible to receive a dividend or distribution. The determination of a record date is required to ascertain who exactly a company’s shareholders are as of that date, since shareholders of an actively traded stock are continually changing. The shareholders of record as of the record date will be entitled to receive the dividend or distribution, declared by the company. read more

Delta is the ratio that compares the change in the price of an asset, usually marketable securities, to the corresponding change in the price of its derivative. For example, if a stock option has a delta value of 0.65, this means that if the underlying stock increases in price by $1 per share, the option on it will rise by $0.65 per share, all else being equal.

A basket of goods refers to a fixed set of consumer products and services whose price is evaluated on a regular basis, often monthly or annually. This basket is used to track inflation in a specific market or country, so that if the price of the basket of goods increases by 2% in a year, inflation can thus be said to be 2%. The goods in the basket are meant to be representative of the broader economy and are adjusted periodically to account for changes in consumer habits.

Limited common elements are the properties of a condominium unit that are assigned to the unit, but are considered to be the property of the condominium community association and not the tenant.

A bullet bond is a debt instrument whose entire principal value is paid all at once on the maturity date, as opposed to amortizing the bond over its lifetime. Bullet bonds cannot be redeemed early by an issuer, which means they are non-callable. Because of this, bullet bonds may pay a relatively low rate of interest due to the issuer’s interest rate exposure.

Out-of-pocket expenses refer to costs that individuals pay out of their own cash reserves. The phrase is most often used to describe an employee’s business and work-related expenses that are later reimbursed by the company. It also describes a policyholder’s share of health insurance costs, including money spent on deductibles, copays, and coinsurance.

The EBITDA-to-sales ratio is a financial metric used to assess a company’s profitability by comparing its revenue with earnings. More specifically, since EBITDA is derived from revenue, this metric indicates the percentage of a company’s earnings remaining after operating expenses. Operating expenses include the cost of goods sold (COGS) and selling, general, and administrative (SG&A) expenses.

A qualification ratio notes the proportion of either debt to income or housing expense to income. Mortgage lenders use qualification ratios to determine a borrower’s creditworthiness for certain loan amounts. Generally, a borrower’s housing expenses alone, which includes any homeowner’s insurance, taxes and condominium fees, cannot exceed 28 percent of a borrower’s monthly gross income. The borrower’s debt-to-income ratio (DTI), which includes housing expenses plus debt, generally cannot exceed 36 percent of monthly gross income. read more

Ordinary and necessary expenses are expenses incurred by individuals as the cost of owning a business or carrying on a trade. Ordinary and necessary expenses are categorized as such for income tax purposes, and these expenses are generally considered tax deductible in the year they are incurred.