Glossary of Terms

AGM - The Annual General Meeting (AGM) is held each year prior to March 31st as noted in the MFA Act.

CPI - Consumer Price Index: a measure of relative changes in the prices of selected goods and services bought by middle income city families, compiled by the Bureau of Labour

Dividend Yield - the annual dividend per share divided by the current price of the company's stock, expressed as a percentage. This ratio is very mercurial, in line with the ups and downs of the stock market.

FOMC - Federal Open Market Committee: an adjunct committee of the Federal Reserve System, composed of the seven members of the Board of Governors - appointed by the U.S. president - and give bank presidents from among the 12 Federal Reserve Banks. Of those five, four rotate into positions and the fifth is the president of the Federal Reserve Bank of New York. The committee is responsible for the system's open-market operations -purchasing and selling U.S. government and agency securities. This action adjusts the amount of money available to banks and other depository institutions for lending the United States, and thus controls the amount and interest cost of commercial credits. The committee also develops strategies to promote economic growth, full employment, stable prices, and a stable pattern of international trade and payments. It also manages the Fed's strategies in foreign currencies.

Futures - (or future contracts), contractual agreements to buy or sell specific amounts of interest rates, currencies, commodities, or stock indexes, at certain dates in the future for specific prices.

Hedge - An investment made in order to reduce the risk of adverse price movements in a security, by taking an offsetting position in a related security.

Index - a benchmark against which financial or economic performance is measured. An index whose purpose is to reveal the performance of the entire market is called a broad based index such as the S&P 500 or the AMEX Major Market Index. The S&P 500 is a market-value weighted index of 500 blue-chip stocks, considered to be a benchmark of the overall stock market. This index is composed of industrial, transportation, utility, and financial companies with a heavy emphasis on industrial companies.

LIBOR - London InterBank Offered Rate: to borrowers of money, it is a floating rate that serves as a basis for many international lending and other financial agreements.

Members of the Authority - The number of MFA Members appointed by each Regional District board is based on population of the Regional District. Currently, there are 28 Regional Districts and 38 Members of the Authority. Capital Regional District and Fraser Valley Regional District having two appointments, Greater Vancouver Regional District (Metro Vancouver) with nine appointments and remaining Regional Districts with one. The Members of the Authority elect a Chair and a Acting-Chair each year at the AGM.

Monetary Policy - a prevailing program followed by a government or central bank, but usually a central bank, in establishing actions designed to either stimulate or slow down the economy, emphasizing changes in the availability of liquid assets to banks and consumers.

Rally - a rapid rise in prices after a sharp decline

Speculation - the commitment of capital with its appreciation rather than its preservation and income as the primary objective.

MFA Board of Trustees - The Members elect the Board of Trustees annually from amongst themselves at the MFA Annual General Meeting (AGM) usually held in March. The Board of Trustees is composed of a chair and nine trustees: four must be from the Greater Vancouver Regional District, one from the Capital Regional District and the other five from the remaining regional districts. The Chair of the Members is the Chair of the Trustees.

Yield Curve - a graph depicting the term structure of interest rates on which the average yields of bonds of like quality, with maturities ranging from short-term to long-term, are plotted. The curve indicates whether short-term rates are higher or lower than long-term rates, and whether there are imbalances in the supply and demand for money and capital over the time horizon plotted. When short-term rates are lower, the yield curve is positive. When the short-term rates are higher, it is called a negative curve. When the curve is straight, the yield curve is called flat.