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Rather than simply acting as an agent, an investment bank or other underwriters directly purchase securities from the issuer, usually at a discount to the market price, and then sells them to investors.

A type of underwriting where the brokerage firm acts as principal. The brokerage firm risks its own capital to purchase all of the securities to be issued. If the price of the securities decreases before the brokerage firm has had a chance to resell the securities to its clients, the firm absorbs the loss.

This occurs when a stock hits support in the form of an old high, a moving average, a trend line, or a combination of these, and moves up sharply. It is like dropping a ball onto a concrete sidewalk-the sidewalk is hard support and the ball bounces sharply. Not all support is strong enough for a bounce-we look for old tops (highs on the way up), breakout points (they act as resistance until the breakout-if the breakout is on good volume, it should act as support and give you a bounce). If money flow is good and the market is not tanking, we usually see a bounce off of this solid support.

Option arbitrage in which a profitable position is established with no risk. One spread is established with call options. The other spread is established using put options.

Everything a company or person owns, including money, securities, equipment and real estate. Assets include everything that is owed to the company or person. Assets are listed on a company’s balance sheet or an individual’s net worth statement.

This is the price of the last trade of a stock when the market closes for the day. This price is of primary importance in our trading as where a stock closes in its range tells us much about the direction and momentum of the stock.

This is a stock’s trading price when a stock begins trading for the day. It may gap up, gap down, or open where it closed the previous session. Where a stock opens can be deceptive, especially if the stock gaps up or down significantly from the closing price.

Average number of shares traded per day over a specified period.

Average price/earnings ratio of stocks owned by a mutual fund.

Statistical tools that measure the state of the stock market or the economy, based on the performance of stocks, bonds or other components. Examples are the S&P/TSX Venture Composite Index, the S&P/TSX Composite Index, the Dow Jones Industrial Average and the Consumer Price Index.