Paid up Capital:

Issued capital of a corporation that has be paid up by the shareholders

Paper:

Money market instruments, commercial paper and other.

Paper Gain (Loss):

Unrealized capital gain (loss) on securities held in portfolio, based on a comparison of current market price to original cost.

Par:

(1) Price of 100 percent.

(2) The principal amount at which the issuer of a debt security contracts to redeem that security at maturity, face value.

Par Bond:

A bond selling at par.

Par Value:

The principal amount, or value at maturity, of a debt obligation. It also known as denomination or face value. Preferred shares may also have a par value, which indicates the value of assets each share would be entitled to it the company were liquidated.

Partnership:

A business venture of two or more individuals of companies. If equal partners, profits or losses flow, directly and equally to the partners.

Partnership of Acquests:

The new regime governing marital property under the Civil Code of the Province of Quebec. It replaces the old community-of-property regime.

Past Service Contribution:

Contributions made to a pension plan to provide benefits conferred in recognition of service with the employer before the pension plan was installed.

Patronage Dividends:

Dividends paid to the members of a consumer cooperative based on the amount they purchase from the cooperative in a given period.

Payroll Deduction:

Payments made on your behalf by your employer. They are automatically deducted from your pay cheque.

PA-Pension Adjustment:

A pension adjustment is the deemed value, for tax purposes, of benefits accruing to members of a Registered Pension Plan (RPP) or Deferred Profit Sharing Plan (DPSP). The PA is used to reduce RRSP contribution room, as it is deemed to represent the value of the benefit that you are accruing under another tax deferral plan. In general the PA is calculated as 9 times the benefit accruing under an RPP or DPSP less $1,000.

As an example, say I earned $40,000 last year. This year I would be able to contribute $7,200 to my RRSP (40000*0.18). However, last year I was in my employers registered pension plan. Under the plan I accrue, or earn, a benefit of 1.5% of my salary. The value of the benefit I earn is therefore $600 for the year. The PA is $4,400 (9*600-1000). The PA reduces my available RRSP room, so instead of $7,200 of room I can only contribute up to $2,800.

The PA system is an attempt to equalize tax deferred savings programs in Canada so members of a company sponsored RPP don't have any advantage by accruing benefits in the plan and also being able to contribute the same amount to their RRSP as someone who is not in an RPP.

Penny Stocks:

Stocks selling at disreputably low prices - that is, measured in cents instead of dollars.

Pension Income Deduction:

The first $1,000 of pension income from certain sources is deductible from one's income for tax purposes. Applies to income from a pension or superannuation fund at any age, and where income is obtained from "private" sources, RRSP from age 65.

Pensionable Employment:

Any form of employment not exempt under the Canada Pension Plan that generates income subject to contributions to CCP.

Permanent Life Insurance:

The most common types are whole and universal . Both offer lifetime protection. Renewal is not necessary as long as you pay the premiums.

Per Capita (Life Insurance):

The death proceeds of a contract or policy are divided equally among the living beneficiaries. For example if three beneficiaries are named but one is no longer living, the remaining to will each receive 1/2 of the proceeds. For contrast see per stirpes.

Per Stirpes (Life Insurance):

The death proceeds of a contract or policy are divided equally among the named beneficiaries. The share of any deceased named beneficiary is distributed to his/her living dependents. For contrast see per capita.

Personal Identification Number (PIN):

A security code known only to the bank card holder and used to access on-line financial services.

Personal Net Worth:

Total assets minus total liabilities of an individual.

Personal Representative:

A general term applicable to a person, including an administrator or executor, having the legal right to represent a person including a deceased person.

Personal Unsecured Loans:

These are loans that require no collateral and are not "secured" by any real assets.

Personal Guarantee:

A legal contract binding a individual with the responsibility for payment of a debt or performance of some obligation if the person and or a company fails to perform.

P.I.T (Mortgage)

Principal, Interest, Taxes.

Pledged Account Mortgage (PAM):

Money is placed in a pledged savings account and this fund plus earned interest is gradually used to reduce mortgage payments.

Point:

(1) 100 basis points=1 percent.

(2) Once percent of the face value of a note or bond.

(3) In the foreign exchange market, refers to the lowest level at which the currency is priced.

Example: "One point" is the difference between a sterling price of $1.8080 and $1.8081.

Pooled RESP:

An RRSP in which the investment earnings on the funds contributed by a group of subscribers are allocated only to those beneficiaries who pursue a post-secondary education. Also referred to as an education trust, a scholarship trust or a group RESP.

Pooled Risk:

In group insurance the claims/premiums experience is averaged to prevent an unusually bad experience by a single employer which would have an extremely adverse effect on its future premiums.

Portfolio:

Collection of securities held by an investor.

Portfolio Manager:

An individual, usually a professional, who attempts to produce the highest return on invested capital while incurring a minimum of risk within the guidelines laid down by the person or company whose funds he is investing.

Portfolio Management:

The systematic development and implementation of an investment strategy, the purpose of which is to achieve the investor's financial goals. Often portfolio management is mistaken for the simple buying of new securities and the selling of current holdings.

Position:

(1) To go long or short in a security.

(2) The amount of securities owned (long position) or owed (short position).

Power of Attorney:

Gives signing authority for your affairs to a spouse or other trusted person in case of accidental or other circumstances that leave your own unable to manage your own affairs.

Pre-Authorized Chequing Arrangement (PAC):

An arrangement you can make with your bank to remove a predetermined amount from your account at regular intervals and place it elsewhere. This method is a convenient means of savings.

Preferred (Shares) Stock:

A type of stock that has certain privileges not available to common shareholders. In particular, dividends on preferred stock must be paid before those on common shares, and preferred shareholders, in theory, get their investment back from the liquidation of a company before common shareholders. In exchange, they usually get only a fixed dividend, regardless of how much is paid to common shareholders, and usually do not get a vote in company affairs.

Premium:

(1) The amount by which the price at which an issue is trading exceeds the issue's value.

(2) The amount that must be paid in excess of par to call or refund an issue before maturity.

(3) In money market parlance, the fact that a particular bank's CD's trade at a rate higher than others of its class, or that a bank has to pay up to acquire funds.

Prepayment Charge (Real Estate):

A fee charged by the lender when the borrower prepays all or a portion of a mortgage loan, more quickly than provided for in the mortgage agreement.

Prepayment Options (Real Estate):

A clause in a mortgage agreement which specifies when and how prepayments may be made.

Present Value:

The value today of something (usually money) to be delivered in the future. This recognizes that interest and certain contingencies make a dollar several years hence worth less than a dollar today.

Price-Earnings Ratio:

The price of a stock divided by the profit the company makes per share A $10 stock of a company that is earning the equivalent of $1 for each of its shares has a ratio of ten. Also known as the PE multiple. It's a measure of whether a stock is cheap or expensive.

Price Indexes:

Measure changes in the cost of a basket of goods over time. Current practice in index design is to use chain-weighting, which adjust for changes in consumption patterns over time.

Price Level:

The average price as measured by a price index.

Primary Market:

A financial market where new issues of security are offered.

Prime Rate:

The rate at which banks will lend to their best (prime) customers. The all in cost of a bank loan to a prime credit equals the prime rate plus the cost of holding compensating balances.

Principal:

(1) The face amount or par value of a debt security.

(2) One who acts as a dealer buying and selling for his own account.

Principal (Real Estate):

The amount actually borrowed.

Principal Residence:

Any accommodation that you own (either alone or jointly) that is normally inhabited by you, your spouse or child.

Private Health Insurance:

Insurance plans provided by private insurance companies, in contrast to health insurance provided by government or public agencies such as Blue Cross.

Private Placement:

An issue that is offered to a single or a few investors as opposed to being publicly offered. Private placements do not have to be registered with the OSC or SEC.

Probate:

The process used to make an orderly distribution and transfer of property from the deceased to a group of beneficiaries. The probate process is characterized by court supervision of property transfer, filling of claims against the estate by creditors and publication of a last will and testament.

Product Insurance:

Insurance purchased by manufacturers or distributors to protect them from liability to people that have suffered a loss, damage or injury as a result of using their product.

Professional Liability Insurance:

A form of public liability insurance designed to indemnify practicing members of a profession from losses payable to patients or clients arising from their negligence in carrying out their profession.

Profit Sharing:

Employer-sponsored retirement plan that allows employees to share in company profits. The employer makes contributions in profitable years to individual employee accounts. The account grows until the employee retires or leaves the company.

Program Trading:

Computer-driven transactions in the stock market and index futures by professional managers of big pools of money. An early term is arbitrage.

Promissory Note:

1) An unconditional promise to pay on demand or by a fixed date a certain amount of money.

2) A written promise to pay money or money's worth usually for goods and/ or services received.

Program Trading:

Computer-driven transactions in the stock market and index futures by professional managers of big pools of money. An early term is arbitrage.

Prospectus:

A detailed statement prepared by an issuer and filed with the a Securities Regulator prior to the sale of a new issue. The prospectus gives detailed information on the issue and on the issuer's condition and prospects.

Public Assistance:

Government-administration programs designed to ensure social adequacy where the costs of the program are the responsibility of society as a whole.

Public Liability Insurance:

Insurance designed to indemnify you of losses that arise out of negligence in your work, volunteer activists.

Public Trustee:

The official appointed by the provincial government to supervise the administration of assets owing to a charity, or mental incompetent in an institution or a public trust.

Purchasing Power:

The amount of goods that con be purchased for a given dollar amount.

Pure Risk:

Risk that has no opportunity for gain (i.e., where the only possible outcomes are loss or no loss.)

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.