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Specialized Glossaries:

Mortgage / Real Estate
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Mutual Funds
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Abbreviations / Acronyms

Definitions – M

Make a Market:

A dealer is said to make a market when he quotes bid and offered prices at which he stands ready to buy and sell.


Managed Investment Fund:

A specific pool of money that is invested by an institutional investor or a professional investment manager.


Management Expense Ratio:

A measure of the total costs of operating a mutual fund as a percentage of average total assets.


Management Fee:

The sum paid to the investment company's advisor or manager for supervising its portfolio and administering its operations.



The amount of money supplied by an investor as a portion of the total funds needed to buy or sell a security, with the balance of required funds loaned to the investor by a broker, dealer, or other lender.


Margin Account:

A special account set up by a broker for a client who wants to buy and sell securities using margin.


Margin Call:

A call from a broker to a client asking for more money to back up a security purchased on margin when such a security has declined in value. If more money is not supplied, the security is usually sold by the broker.


Margin (Mortgage):

The amount a lender adds to the index on an adjustable rate mortgage to establish the adjusted interest rate.


Marginal Income Tax Bracket:

Canada operates under a graduated income tax system, which means the tax rate increases as income rises. The marginal income tax bracket is the rate at which your next dollar of income will be taxed. For illustration lets say, you earned $30,000 in 1998 you would pay 17 per cent of your income in taxes; if you earned $30,001 your marginal income tax bracket would jump to 26 per cent of your income.


Marginal Tax Rate:

The tax rate that would have to be paid on any additional dollars of taxable income earned.


Margined Stock:

A stock that has been purchased using leverage.



A negotiable security is said to have good marketability if there is an active secondary market in which it can easily be resold.



A communications medium that facilitates the purchase and sale of a particular category of securities, such as stocks or bonds. Traditionally, this has been a building or particular location (called an "exchange") where people meet to buy and sell such securities, but advances in modern technology have eliminated the necessity for face-to-face contact, and a "market" can now be the collection of telephones and computer terminals used to trade securities.


Market Bottom:

The time when a category of securities, such as stocks, are felt to have reached their lowest prices as a group for an extended period of, say, three or four years. Usually measured by the lowest level of an index that indicates what is happening within that market, such as the Dow Jones Industrial Index.


Market Capitalization:

Market capitalization is the amount of money someone would have to pay to buy the company. To calculate market capitalization, multiply the total number of a company's shares by the current price per share. For example, if a company has 10 million shares, and the current price is $20 per share, then the company's market capitalization is $200 million ($20 x 10 million).

-Large cap is a company with over $1 billion in market capitalization

-Mid cap has between $500 million and $1 billion

-Small cap has less than $500 million.


Market Index:

A vehicle used to denote trends in securities markets. The most popular in Canada is the Toronto Stock Exchange 300 Composite Index (TSE 300) see TSE.


Market Order:

An order to buy at the lowest price going, or sell at the highest price possible. (See Limit order)


Market Price:

In the case of a security, market price is usually considered the last reported price at which the stock or bond is sold.


Market Risk:

The uncertainty of economic, social; or political events that would result in an investment's decrease in value. Since these events usually affect the entire market, market risk is called systematic risk.


Market Sector:

A group of securities traded in the same market and sharing similar characteristics, such as being issued by a single issuer or set of issuers.


Market Share:

A portion of the total market that a company is able to obtain with its products.


Market Timing:

An element of investment strategy. Investors will often seek to increase the amount of money they can make in a particular security or category of security by purchasing it when the market associated with that type of security is near its trough, and sell these holdings when the market is near its peak.


Market Value:

The highest price that a buyer would pay and the lowest price the seller would accept on a property. Market value may be different from the price a property could actually be sold for at a given time.


Match Fund:

A bank is said to match fund a loan or other asset when it does so by buying (taking) a deposit of the same maturity. The term is commonly used in the Euromarket.


Matched Book:

If the distribution of the maturities of a bank's liabilities equals that of its assets, it is said to be running a matched book. The term is commonly used in the Euromarket.


Maturing Debt:

In this context, bonds or money market securities that will be redeemed by the borrower in the near future.



The date at which maturing debt is redeemed.


Maturity Date (Real Estate):

The last day of the term of the mortgage agreement. The mortgage loan must then be paid in full or the agreement renewed.


Maturity Schedule:

A table describing the timing and amounts of currently outstanding debt of a particular issuer that will reach maturity in the future.


Medical Power of Attorney:

This special power of attorney document allows you to designate another person to make medical decisions on your behalf, also review the Substitution Decisions Act in the Money Management Newsletter Library.



A personal contact or teacher who can assist a person in achieving their objectives or dreams.


Member Share Dividends (Credit Union's):

Dividends paid to all Credit Union members who have purchased the required number of membership shares.


Merchant Bank:

A British term for a bank that specializes not in lending out its own funds, but in providing various financial services such as accepting bills arising out of trade, underwriting new issues, and providing advice on acquisitions, mergers, foreign exchange, portfolio management,etc.


Mezzanine finance:

A loan advanced prior to a firm going public. Venture capitalists are active at this stage of a corporations growth.



Mortgage Insurance Corporation of Canada


Mid-Cap Stock:

A mid-cap stock is from a company with between $500 million and $1 billion in Market capitalization .


Minimum Monthly Balance:

The smallest amount in a bank account during the month; the amount on which interest is payable. Interest is often paid on the minimum semi-annual balance.


Minority Interest:

A company may own most, but not all, of a subsidiary company. That portion of ownership that the parent company doesn't possess is listed on the parent's balance sheet as minority interest.



A mismatch occurs when the remaining term of rate sensitive assets in a portfolio differs from that of rates sensitive liabilities. An interest rate exposure results since a change in interest rates affects income earned by a Financial Institution on loans and interest paid on deposits.



Someone, usually an economist, who subscribes to the view that the rate of change of a country's money supply is the most important factor in determining the future course of economic events.


Monetary Policy:

Federal government policy pursued by the Bank of Canada to control interest rates and the supply of money.


Money Market:

A market devoted to debt securities that are repaid within three years of issuance. Such securities generally pay interest at a specified rate. The market in which short-term debt instruments (bills, commercial paper, bankers' acceptances, etc.) are issued and traded.


Money Market Fund:

Mutual fund that invests solely in money market instruments.


Money Purchase Plan:

A pension plan on which contributions are defined rather than benefits.


Money Rate of Return:

Annual money return as a percentage of asset value.


Money Supply:

M1: Money supply measured as the amount of demand deposits plus currency in circulation.

M2: M1 plus small-denomination savings and time deposits at commercial banks.

M3: M2 plus deposits at non-bank savings institutions.

M4: M2 plus large-denomination CDs.

M5: M3 plus large-denomination CDs.


Money Supply Figures:

Information released weekly by the central bank of the United States or Canada about the amount of money currently in existence in that country. These figures change constantly with changes in economic activity and are felt to be a good indicator of the pace of the economy.


Mortgage Bond:

Bond secured by a lien on property, equipment, or other real assets.


Mortgage Broker:

A professional person who helps you arrange for mortgage financing on your home or other real property. He or she also can arrange for the buying or selling of a mortgage.


Mortgage Loan:

A loan used primarily for the purchase of real property. The property being purchased becomes the security for the loan.

Closed Mortgage: These agreements do not provide for payout prior to maturity. A lender may permit payout under certain circumstances but will levy a penalty charge for doing so if such exceeds certain limits, if any, specified in the mortgage (i.e.. 15% prepayment provision).

Open Mortgage: allows pre-payment/repayment at any time without penalty. Normally the interest rates charged on open mortgages are higher than closed, and the term is shorter.


Mortgage/Real Estate Terms:

This link to our special Mortgage/Real Estate Terms glossary:



A legal document that represents a loan for which a specific piece of property is pledged as collateral. Such documents are often bought and sold by investors, as the lender has agreed to pay interest on the loan to the holder. The borrower.



The lender.



The borrower.


Mortgage Options:

Rate buydown program: If you're selling your home, you choose to increase its appeal by using this program to buy down the mortgage rates by as much as 3 or 4%.

Portable Mortgage option:If you're buying a new home and you like the terms and conditions of your existing mortgage, you can use this option and carry them over to your new mortgage on the new house.

Pre-approved mortgage: This product offers you the security of knowing how much mortgage financing is available, and protect your rate for up to 60 to 90 days depending on the lender.

Rate-capper/stopper mortgage option: An option that can lock in the term up to 5 years and protection from increased interest rates while offering the flexibility of a variable-rate loan.

Add-On option: This allows you to borrow up to 70% of appraised value of your home minus your outstanding mortgage balance.

Double-up: You can Double-up your interest and principle payments any month or every month.

Skip-A-payment: If you are short of the mortgage payment you may skip a payment, If you have used the double-up option you may reverse the payments.


Mortgage Types:

Conventional mortgage: This type is a uninsured mortgage loan , and does not exceed 75% of the lesser of the purchase price or appraised value. NHA: A NHA insured mortgage is one where mortgage insurance is provided by Canada Mortgage & Housing Corporation (CMHC).

Closed Mortgage: These agreements do not provide for payout prior to maturity. A lender may permit payout under certain circumstances but will levy a penalty charge for doing so if such exceeds certain limits, if any, specified in the mortgage (I.e.. 15% prepayment provision).

Open Mortgage: allows pre-payment/repayment at any time without penalty. Normally the interest rates charged on open mortgages are higher than closed, and the term is shorter.


Moving Average:

The moving average (in security charts), is a curve that averages price fluctuations of the security over a 50-day or 200-day interval. Each point on the moving average curve is calculated by averaging the closing prices from the previous 50 (or 200) days of trading. The moving average is a way to compare long-term price trends with recent price changes.


Multi-Account System:

The use by an individual of several bank accounts in which each is allocated certain sources or amounts of money.


Multicurrency Clause:

Such a clause on a Euro loan permits the borrower to switch from one currency to another on a rollover date.

Multidisciplinary: Making use of several disciplines at once: a multidisciplinary approach to teaching.

However, when used within investing, it's referring to differing investment strategies that often times divide into 5 categories. ( Shown in the chart below)

This investment management approach center's around a group of specialists, who in turn are drawing upon products and strategies as a group, thus the creation of a product that combines different management styles that normally are available is separate funds.

Strategy Description
Event-driven Managers seek to capitalize on the changes in the value of a security based on a given event such as a merger, acquisition, bankruptcy, etc.
Relative values Manages seek to identify securities that are fundamentally alike but have recently evolved differently in price.
Global asset allocation Managers look for opportunities at the macroeconomics level, i.e. differences in performance between regions and industries.
Equity hedge Managers look for market weaknesses to generate positive returns.
Short sales Managers seek to sell securities without ownership to take advantage of an anticipated price decline and buy the security later at a lower price.

Mutual Funds:

A mutual fund is a portfolio of investment securities held in the name of the fund, which is owned by people who have bought shares in the fund itself.

Types of Mutual Funds

Canadian Equity Funds: invest primarily in common stocks and other equity securities of Canadian companies.

Canadian Resource Equity Fund: Invest in the Canadian resource sector, such as forestry, mining, oil and gas stocks.

U.S. Equity Funds: Invest a large portion of assets in common stocks and other equity securities of U.S. Companies.

North American Equity Funds: Invest in Canadian and U.S equity securities, but may hold Mexican equity securities.

Global Equity Funds: Invest in common stocks and other equity securities of foreign and Canadian issuers. A fund's investments are not limited geographically.

International Equity Funds: Invest primarily in common stocks and other equity securities of foreign issuers. No Canadian securities.

Asia-Pacific Rim Equity Funds: Invest primarily in common stocks and other equity securities with principal business activities in one or more Asia-Pacific Rim region countries.

European Equity Funds: Invest primarily in common stocks and other equity securities of companies with principal business activities in one or more European countries.

Dividend Funds: Invest in high dividend-paying preferred (and sometimes common) shares of Canadian companies.

Canadian Bond & Income Funds: Invest primarily in fixed-income securities of Canadian government and corporate issuers.

U.S. & International Bond & Income Funds: Invest in U.S. and foreign government and corporate securities, or in Canadian government and corporate securities in U.S. or foreign denominations.

Mortgage Funds: Invest in residential and commercial mortgages.

Canadian Balanced Funds: Invest in a blend of Canadian stocks and bonds and generally must maintain minimum holdings of each.

U.S. & International Balanced Funds: Invest in a balance of U.S. or international stocks and bonds, or Canadian issues in U.S. or international denominations.

Asset Allocation Funds: Assets are allocated among stocks, bonds and money-market instruments, which will vary according to economic conditions. Normally no minimum asset holding requirements.

Money Market Funds: Almost all assets in Canadian money market instruments such as treasury bills, certificates of deposit, short-term government bonds and commercial paper.

U.S. & International Money Market Funds: Almost all assets in U.S. or foreign money-market instruments, or in Canadian money-Market instruments denominated in U.S. or foreign currencies.

Real Estate Funds: Invest in commercial and industrial real estate.

Specialty Funds: Invest in specific markets, such as precious metals or commodities.


Mutual Balanced Funds:

A fund which has an investment policy of "balancing" its portfolio, generally by including bonds and shares in varying proportions influenced by the fund's investment outlook.


Mutual Dividend Fund:

A mutual fund that invest in common shares of senior Canadian corporations with a history of regular dividend payments at above average rates, as well as preferred shares.


Mutual Equity Funds:

A fund whose portfolio of which consists primarily of common stock.


Mutual Growth Funds:

Fund that hold growth shares of companies whose earnings are expected to increase at an above-average rate. Growth stocks are often typified by their Low yields and relatively high price/earnings ratios. Their prices reflect investors, belief in their future earnings growth.


Mutual Income Funds:

Mutual funds that invest primarily in fixed-income securities such as bonds, mortgages and preferred shares. Their primary objective is to produce income for investors, while preserving capital.


Mutual Index Funds:

A mutual fund that matches its portfolio to that of a specific financial market index, with the objective of duplicating the general performance of the market in which it invests.

Mutual International Fund:

A fund that invest in securities of a number of countries.


Mutual Money Market Fund:

A type of mutual fund that invests primarily in treasury bills and other Low-risk short-term investments.


Mutual Mortgage Fund:

A mutual fund that invest in mortgages. Portfolios of mortgage funds usually consist of first mortgages on Canadian residential property, although some funds also invest in commercial mortgages.


Mutual Fund Prospectus:

A legal document which describes the investment objective of the fund, the manner in which the fund is administered and operated, the fees and other pertinent information.


Mutual Real Estate Fund:

This type of fund invests primarily in residential and/or commercial real estate to produce income and capital gains for its unitholders.

Mutual Specialty Fund:

A mutual fund that concentrates its investments on a specific industrial or economic sector or a defined geographical area.


Mortgage Insurance Corporation of Canada.

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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