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Abbreviations / Acronyms

Definitions – E


The total net profits earned by a company. Total sales less cost of sales and operating expenses, including interest and income tax.


Earnings Per Share:

Total net profits divided by the number of outstanding common shares.


Earning Statement:

A financial statement showing the income and expenses of a business over a period of time. Also known as an income statement or profit and loss statement (P&L).



A branch of economic forecasting in which computers are used to produce detailed and, supposedly, internally consistent economic forecasts based on a mathematical description of the economy.



The study of how people use scarce resources to satisfy unlimited wants.


Economic Cycle:

Economic events are often felt to repeat a regular pattern over a period of anywhere from two to eight years. This pattern of events ends to be slightly different each time, but usually has a large number of similarities to previous cycles.


Economic Expansion:

A period of increasing economic activity and rising prosperity.


Economic Forecast:

A prediction of the nature and pace of economic events, usually for a period of about one year into the future.


Economic Indicators:

They are divided into three categories - lagging, coincident and leading.

1. Laging indicators arrive after the fact.

2. Coincident indicators indicators describe current conditions

3. Leading indicators forecast changes in the economy


Economics of Scale:

The possibility of spreading costs among a greater number of transactions, inputs, etc. that reduces the overall cost of production.


Effective Annual Interest Rate:

The rate that is actually earned by the end of a year.


Effective Interest Rate (Real Estate):

A variable interest rate translated into the rate that would be paid if the interest was compounded on a semi-annual basis.


Effective Tax Rate:

The percentage of total income paid in federal and provincial income taxes.


Efficient Market:

The market in which all the available information has been analyzed and is reflected in the current stock price.



Funds invested by a company's owners in its operations. Also, another word for stock.


Equity Buy-back:

The capacity of a company to reacquired a percentage of investors ownership, usually at a predetermined amount.


Equity (Real Estate):

Equity is the difference between the price for which a property could be sold and the total debts registered against it.


Equity Financing:

Equity financing by a corporation is obtaining of funds by selling stock. It is so called because stock represents ownership, interest or equity.


Equity Shares (Credit Union's):

Membership shares and investment shares. Adult members must purchase up to say $50. of membership shares to be a member of the Credit Union. Funds invested in these shares are not guaranteed a The Credit Union Insurance Corporation.


Equivalent Taxable Yield:

The yield on a taxable security that would leave the investor with the same after-tax return he would earn by holding a tax-exempt security; for example, for an investor taxed at a 50 % marginal rate, equivalent taxable yield on a tax-exempt note issued at 3% would be 6 percent.


Escalator Guaranteed Investment Certificates (GIC):

A type of debt security sold to individuals by banks and trust companies. They usually cannot be cashed before the specified redemption date, and pay interest at a fixed rate. The interest is different each year throughout the term normally on an upward trend. For comparison against a normal GIC you need to know the blended rate.


Escrow (Mortgage):

Funds that are set aside and held in trust, usually for payment of taxes and insurance on real property. Also deposits held pending loan closing.


Escrow Receipt:

A certificate issued by an approved depository (usually a financial institution) to clearing corporation on behalf of an investor evidencing ownership of the underlying Call /interest/stock//bond. Upon assignment of that property, the approved depository agrees to deliver the underlying property to the clearing corporation against the aggregate assignment value.



All assets owned by an individual at the time of death. The estate includes all funds, personal effects, interest in business enterprises, titles to property, real estate and chattels, and evidence of ownership, such as stocks bonds and mortgages owned, and notes receivable.

Estate Freeze:

A legal procedure that limits the growth in value of the freezor's estate. This is done by diverting the growth to the subsequent generation.


Estate Planning:

The orderly arrangement of one's financial affairs to maximize the value transferred at death to the people and institutions favored by the deceased, with minimum loss of value because of taxes and forced liquidation of assets.



Bonds issued in Europe outside the confines of any national capital market. A Eurobond may or may not be denominated in the currency of the issuer. Canadian dollars deposited in a London bank are EURO Canadian dollars, German marks deposited there are EURO marks.


Euro CD's:

CD's issued by a bank branch or a foreign bank located outside of Canada. Almost all EURO CD's are issued in London (U.K.).


Euro Canadian Dollars:

Canadian dollars deposited in Canadian bank branch or a foreign bank located outside Canada.


Euro Currency Deposits:

Deposits made in a bank or bank Branch.


Euro Pounds (Sterling):

English pounds (Sterling) deposited in a English bank branch or foreign bank located outside the UK


Euro U.S. Dollars:

U.S. dollars deposited in a U.S. bank branch or a foreign bank located outside the United States.


Exchange For Physicals (EFP):

An EFP is a trade between two parties in which one party is a buyer of physical (lets say gold) metals and the seller of the equivalent in the form of futures contract, and the other party is the seller of the physical metals and the buyer of the same quantity in the form of a futures contract.


Exchange Privilege (Swaps):

The ability of a shareholder to transfer investments from one mutual fund to another within a "family" of funds managed by the same company. This exchange may or may not be accompanied by a transaction fee which is based on the asset value of the transfer.


Exchange Traded Funds (ETFs):

Exchange Traded Funds are funds that are based on a specific market index or sector, but that trade on the stock exchange like any company share. Unlike regular open-end mutual funds, ETFs can be bought and sold at any point in the trading day. They can be sold short and bought on margin, so they behave more like a stock than a traditional mutual fund.



The actual transaction to purchase or sell a security.



The person named in a will to manage the estate of the deceased according to the terms of the will.

  Exchange Traded Funds (ETFs)

Expected Return:

The estimated return on an investment calculated by examining returns based on the likelihood of different outcomes.


Expiry Date:

The Futures and options contracts have an end date and the most active trading period usually is within 90 days of expiry. For most exchanges traded securities, this date is on the third Friday of the month.


Extendable and Retractable:

An extendable bond gives the holder the right to exchange the bond for a longer-term bond at the same or a higher rate of interest. A retractable bond allows the investor to redeem the bond at par earlier than the original term, For example, a 10-year could be redeemed in 5 years.


Extraordinary Profits:

Profits derived from events not considered part of normal business operations, and hence, not representative of a company's normal earning power.



The description of a stock after a dividend record date has passed.


Exit Options:

If so expressed, a variety of options that the investor can exercise to recover their invested capital and the return on their investment.


Expected Return:

The overall profit that you might expect to receive from your investment - either as income, in the form of interest or dividends, or as capital gains (or losses) resulting from changes in the market value of the security. In theory the higher the expected rate of return of a security, the greater the risk.


Export Credit:

Insurance to cover political and/or commercial risks of selling goods or services in foreign markets.


Export Financing:

Financing products offered by Banks and Government agency to support the activities of Canadian companies expand into foreign markets, consisting of loans, guarantees, letters of credit, insurance.


This Glossary of financial terms was created by Fiscal Agents Financial Information Services, Research Department. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, mechanical, electronic, photocopying, recording, or otherwise, without the prior written permission of Fiscal Agents. Copyright Fiscal Agents © 2000. All Worldwide Rights Reserved. Click to contact Glossary editor or see the permissions page.

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