Venture capital corporation's established by unions, managed by investment managers subject to government regulations

Ladder Approach:

A method involving purchase of several investments, each with a different maturity date, to reduce inflation, interest rate risk and default risk for fixed income investment.

Law of Demand/Supply:

Demand- as the price of goods or services falls, quantity demanded rises. Supply - as it increase, quantity supplied rises.

Leasehold Mortgage:

A company or a government that issues a set of securities.

Leasing Activity (Real Estate):

Real estate companies calculate leasing activity from the unit turnover on its database and from information compiled by the research department and from the local the real estate boards. Whereas absorption reflects growth, leasing activity indicates the volume of business in a given market. Sale activity uses the same premise.

Lessee/Lessor:

Lessee- the holder of a leasehold estate (also called a tenant)

Lessor - the grantor of a leasehold estate (also called the landlord)

Leasehold estate - The interest in land for a definite period of time, such as one year or one hundred years.

Letters of Administration:

A certificate confirming the authority set out in the will to administer a particular estate, issued to an administrator by the proper court.

Letter of Intent:

A document or agreement whereby one party is agreeing to perform a function e.g. an investor agrees to make series of purchases of mutual funds.

Letters Probate:

A certificate of authority to administer a particular estate, issued to an executor by a proper court.

Level Playing Field:

A competitive arena in which no player has an unfair advantage.

Leverage:

The use of borrowed money to buy more of an asset than would otherwise be possible in order to increase the potential profit earned on that asset.

LBO - (Leverage Buyout):

Are deals in which a company is bought with a lot of borrowed money frequently raised through selling high-yield and high-risk junk bonds.

Levered Investment:

An investment bought using leverage (see leverage).

Levy Execution:

A procedure whereby a sheriff can seize your property and sell it to recover the judgment for outstanding debts incurred by the previous owner.

Liabilities:

What you owe.

Liability Risk:

The risk that the legal system may assess punitive damages against you if property damage or personal injuries can be attributed to your carelessness or negligence.

LIBOR:

The London Interbank Offered Rate on Eurodollar deposits traded between banks. There is a different LIBOR rate for each deposit maturity. Different banks may quote slightly different LIBOR rates because they use different reference banks.

Lien:

A claim upon a piece of property for the payment or satisfaction of a debt or obligation.

Life Annuity:

An annuity under which payments are guaranteed for the life of the annuitant.

Life Annuity (With a Guaranteed Term):

An annuity with a special clause that guarantees payments will continue for a specified period, even if the annuitant dies before the end of the term.

Life Estate (Insurance):

Title to a property only for the duration of the life of some specified party. A life tenant is the holder of a life estate.

Life Expectancy:

Life expectancy represents the average future time an individual can expect to live. To perform this calculation assumptions are made as to the mortality table the life will follow. Life expectancies have been increasing steadily over the past century and may continue to increase in the future. As people are living longer the cost of retirement is increasing.

Life Expectancy Adjusted Withdrawal Plan:

A plan though which a mutual fund investor's holdings are fully depleted while providing maximum periodic income over the investor's lifetime.

Life Income Fund:

A RRIF that receive funds from a locked-in retirement account that provides a life income by restricting the maximum withdrawals from the plan based on the equivalent payments from an annuity.

Life Insurance:

Life insurance is a policy agreement (contract) between you and an insurance company. You agree to pay a specified amount (premium) to the company for the policy coverage, and in return, the company agrees to pay you or your beneficiaries based on the terms of the policy. Most life insurance is designed to provide funds to your heirs in the event of your death.

Lifestyle Expenditures:

The cost you incur to sustain your lifestyle, including the money you spend on housing, food, clothing, household expenses, transportation, insurance, entertainment and gifts. Also included are the interest charges associated with financing a major capital purchase such as a house or a car. Lifestyle expenditures do not include income tax expense or any capital transactions.

Limited Liability:

The legal protection accorded to shareholders of a "incorporated" company.

Line of Credit:

An arrangement by which a bank agrees to lend to the line holder during some specified period any amount up to the full amount of the line.

Liquid Assets:

Cash and marketable securities.

Liquidate:

In investment terms, to sell. In corporate terms, the termination of a company's business operations and sale of the company's property, equipment, and other assets. From the proceeds of such liquidation, debts are repaid and capital is returned to shareholders.

Liquidity:

A liquid asset is one that can be converted easily and rapidly into cash without a substantial loss of value. In the money market, a security is said to be liquid if the spread between bid and asked prices is narrow and reasonable size can be done at those quotes.

Liquidity Planning:

Ensuring that sufficient cash or cashable assets are available to meet your needs for cash.

Liquidity Risk:

In banking, risk that monies needed to fund assets may not be available in sufficient quantities at some future date. Implies an imbalance in committed maturities of assets and liabilities.

Living Will:

If you become incapacitated this document will preserves your wishes and act as your voice in medical decisions, if you are unable to speak for yourself as a result of medical reasons.

Load Fund:

A mutual fund that charges a commission to purchase its shares.

Loan-to-Value Ratio (Real Estate):

The ratio of the loan to the appraised value or purchase price of the property, whichever is less, expressed as a percentage.

Locked In (or locked-in"):

Locked-In is a term associated with funds in an RRSP or RRIF.

Funds are termed locked-in when they may only be used to produce retirement income. Locked-in funds generally arise when an individual transfers the commuted value of benefits earned under an employer sponsored pension plan to an RRSP or RRIF. In this situation, the benefits earned under the pension plan were for retirement, so the government forces the commuted value to be used for retirement benefits by locking them in. Even if you want to withdraw locked-in funds prior to retirement to purchase a home or cottage, buy a boat, pay for school etc. you cannot. The locked-in amounts may only be used for retirement income.

Long Bonds:

Bonds with a long current maturity.

(1) Bonds or notes with a long current maturity.

(2) A bond on which one of the coupon periods, usually the first, is longer than the others or than standard.

The term is applied to assets having a useful life longer than one year

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. See Notes and Credits or see permissions page.