Glossary of Investment Terms

Annuities An investment option where you receive a steady monthly income (generally for life) in exchange for a lump sum from your RRSP, RIF or LIF.
CCPC Shares A Canadian Controlled Private Corporation
Contribution Limit How much you can contribute to an RRSP, generally 18% of last year's earned income.  Shown on your Notice of Assessment.
Dividends and Distributions When you get income paid out from a fund, or have the income re-invested in the fund
Dollar Cost Averaging A strategy to help you buy more of a fund when its price is low.
DPSP Deferred Profit Sharing Plans
Foreign Content The percentage amount of a portfolio that is invested outside of Canada.
GIC Guaranteed Investment Certificate
Index Funds A mutual fund that tracks the performance of a major stock index by including all the company shares in that index.  No manager attempts to separate the good and poor performing companies.
Investment Programs ScotiaMcLeod's investment programs offer a systematic approach, reducing the temptation for investors to try to time the market. This leads to better returns, on average, over the long term. They also offer an alternative to commission-based trading.
Labour Sponsored Funds A special type of mutual fund that offers Canadian investors additional tax savings.
LIF - Life Income Fund Like a RIF, but for your locked in RRSP (from a pension plan)
RESP Registered Education Savings Plan - A tax assisted way to save for a Canadian child's education
RRIF - Registered Retirement Income Fund One of the best options for your RRSP at maturity, which allows you to take a regular (taxable) income, while still deferring taxes on the remainder of the account.
Risk The amount of volatility that you can expect on a fund.  Generally based on the historical standard deviation (or variance) of returns over the last 3-5 years.  Good examples of Risk Return charts can be found on our Index Funds page.  Usually included in performance reporting on funds, or by services like Morningstar/Bellcharts.
Spousal RRSP An RRSP that you contribute to and get the tax receipt for, however the money and account is in your spouse's name, so he/she can take it out at retirement (or after 3 years from your last Spousal contribution) at his/her lower tax rate.
SWP A Systematic Withdrawal Plan

For terms not listed here, please contact your ScotiaMcLeod Wealth Advisor.

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