Financial Lexicon: G-L

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Gross Domestic Product (GDP):

  • monetary value of all services provided and finished products made within the borders of a country in a specific time period.

  • included components:

    • government expenditures

    • public and personal consumption

    • investments

    • paid constructions costs

    • exports and imports

  • measure of economic activity within a country's borders.

Growth Stock:

  • share of a company that either has exhibited or is expected to grow profits faster than the average growth of the market.

  • generally do not pay dividends as management focuses on reinvesting profits back into the company to accelerate its growth in the short-term.

  • often seen as more expensive due to higher earnings ratio, which can be misleading if company continues to grow rapidly.

Guaranteed Investment Certificate:

  • guaranteed investment issued by a Canadian bank or financial institution.

  • locked-in deposit earning interest for specified period of time, during which the investment cannot be withdrawn, in most cases.

  • can be locked-in for as little as one month up to as much as 5 years, with longer lock-in periods paying higher interest rates.

  • more popularly referred to by its acronym - GIC.



High-Yield Bond:

  • bond that pays higher interest to offset the higher risk of default associated with lending money to that company or government institution.

  • assigned to entities with credit rates of BB or lower.

  • also known as Junk Bond.

Home Equity Line of Credit:

  • revolving loan whereby the equity value of the borrower's home is used as collateral/security.

  • permits a homeowner to access and borrow the equity value in an owned property.

  • loan proceeds can be used for any purchasing needs, although must follow a repayment of schedule of at least monthly interest but may be more, depending on terms.

  • most applications require an appraisal and initial set-up fee to establish the line of credit, though interest rates are generally lower on such lines of credit as opposed to unsecured ones. 



Initial Public Offering:

  • first offering to purchase a corporation's stock on a stock exchange by the general public.

  • usually referred to in the media as an "IPO".

Investment Grade Bond:

  • corporate or government bond deemed to be of lower risk to default, thus paying lower interest rates.

  • assigned to entities with credit ratings between AAA and BBB.

  • generally attractive to conservative investors.




Joint Tenants With Right of Survivorship (JWTROS):

  • legal ownership structure with two or more parties named as owners of a financial account or asset.

  • each party has equal right to access and use the asset.

  • at death of one party, all surviving parties inherit total value of the deceased party's share, usually without having to take the asset through probate procedures.

Junk Bond:

  • see High-Yield Bond.




Laissez-Faire Economics or Capitalism:

  • philosophy opposing government intervention in economic and business affairs.

  • belief that businesses will be better off, and thus, by extension, so too will society prosper, when government involvement in economic matters is kept at a minimum.

  • French term for "hands off" or "allow to do".


  • any financial debt or obligation of monetary value owed by a person, corporation or institution.

  • expected to be repaid over time through payment of money, goods and/or services.

  • appears on the right side of a balance sheet.


  • ease with which asset or security is quickly bought and sold without significantly disturbing its price.

  • level of flexibility in converting security or asset into cash.

  • the higher the ease/flexibility, the more liquid the asset is said to be. 


  • ownership of a security, with the right to transfer ownership, through sale or gift, to someone else.

  • gives owner the right to receive income paid by the security

  • bestows the right by the owner to share in the profits or losses associated with changing value.

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