Chapter 9: Equity Securities: Equity Transactions

In this section

• 9.1 Cash Accounts and Margin Accounts
  • 9.1.1 Cash Accounts
    Exploration of cash accounts and the foundational aspects of equity transactions.
  • 9.1.2 Margin Accounts
    An in-depth exploration of margin accounts, their purpose, benefits, and regulatory requirements within the context of equity securities transactions.
  • 9.1.3 Risks Associated with Margin Trading
    Exploration of the risks associated with margin trading, including leverage and margin calls, vital for understanding the potential financial challenges in the securities market.
• 9.2 Margin Account Transactions
  • 9.2.1 Initial and Maintenance Margin
    Understanding the rules and regulations governing initial and maintenance margins in margin accounts for equity transactions.
  • 9.2.2 Long and Short Positions
    In-depth exploration of long and short positions in equity transactions, explaining the mechanics and strategies behind both approaches in the context of margin accounts.
  • 9.2.3 Risks of Short Selling
    An in-depth exploration of the risks associated with short selling, including the threat of unlimited loss potential and the borrowing costs and responsibilities.
• 9.3 Trading and Settlement Procedures
  • 9.3.1 Order Types and Instructions
    Understanding various order types, including market and limit orders, and their role in equity transactions.
  • 9.3.2 Execution of Trades
    Detailed explanation of the execution of trades within equity transactions and the importance of trade confirmation and reporting for transparency and compliance.
  • 9.3.3 Clearing and Settlement
    An in-depth exploration of the processes and systems involved in clearing and settling equity transactions within the Canadian securities market.
• 9.4 How Securities Are Bought and Sold
  • 9.4.1 Stock Exchanges
    An in-depth analysis of major stock exchanges, focusing on the Toronto Stock Exchange (TSX), and the listing requirements for companies.
  • 9.4.2 Over-the-Counter (OTC) Markets
    Exploring the characteristics of OTC markets and distinguishing them from exchange trading methods.
  • 9.4.3 Electronic Trading Platforms
    Explore the evolution, advantages, and market impact of electronic trading platforms in equity transactions.