Skip to content
Everyfolio

Learn

Short explanations of how investing and Canadian accounts work. Informative, never advice.

Glossary

Learning pathLibrary

Start here

What exactly is a stock?

Start →

An account keeps your readings and your place.

32
articles published
6categories
13challenges

Quests

Three or four articles around one question, in an order that makes them clearer. Nothing obliges you to follow it.

Learning path

The notions in the order in which they explain one another — foundations first. Nothing obliges you: the categories remain open below.

  • Read
  • To read
  • In progress

Stage 1

Foundations

What you hold — a stock, a bond, an ETF —, where its price comes from, what each account is for, then how to read a statement and a trade confirmation.

See the steps
  1. Start hereStep 1Market mechanicsWhat exactly is a stock?A stock is a share of ownership in a company.Start →
  2. Step 2Market mechanicsWhat is a bond?A stock is a share of ownership; a bond is a loan.
  3. Step 3Market mechanicsWhat is an ETFAn ETF — exchange-traded fund — is a basket of securities that is bought and sold on an exchange like an ordinary stock.
  4. Step 4Market mechanicsWhere a stock price comes fromThe price shown for a stock is not set by anyone — not by the company, not by the exchange, not by a central computer.
  5. Step 5Registered accountsTFSA, RRSP, LIRA…: what each account is forAn investment account is not an investment: it is a container.
  6. Step 6Reading statementsReading a broker statement: average cost, ACB, and why they differTwo columns of a broker’s statement are often confusing: the average cost and the adjusted cost base (ACB).
  7. Step 7Reading statementsThe trade confirmationThe notice received after each trade holds everything Everyfolio asks for: quantity, average price, fees, dates. What each field means, and where it goes.

Stage 2

Mechanisms

How things move and add up: orders, dividends, diversification, fees, exchange rates, compound interest, and the rules of each registered account.

See the steps
  1. Step 8Market mechanicsMarket order, limit orderPlacing an order means choosing what you guarantee: that the trade happens, or the price at which it happens.
  2. Step 9Market mechanicsSplits, consolidations, dividends: what changes and what does notSome events change the number of shares you hold without your having bought or sold anything.
  3. Step 10Market mechanicsDiversification, mechanically"Don't put all your eggs in one basket" is the oldest saying in finance — but behind the adage there is also a precise mechanism.
  4. Step 11Market mechanicsCompound interest, friend and foeCompound interest is presented everywhere as the "eighth wonder of the world". The formula is exact — but incomplete.
  5. Step 12Market mechanicsThe management expense ratio (MER)The management expense ratio — MER — is the annual cost of a fund or an ETF, expressed as a percentage of assets.
  6. Step 13Market mechanicsETFs and mutual funds: the differencesAn ETF (exchange-traded fund) and a mutual fund do the same thing at bottom: they pool money from many people to hold a basket of securities, and each person…
  7. Step 14Registered accountsContribution room: how it accumulatesRegistered accounts such as the TFSA and the RRSP are capped: you cannot put unlimited amounts into them.
  8. Step 15Registered accountsThe FHSA explainedThe FHSA — First Home Savings Account — is the newest of Canada's major registered accounts.
  9. Step 16Registered accountsThe RESP explainedThe RESP — Registered Education Savings Plan — is the account designed to fund a child's post-secondary education.
  10. Step 17Registered accountsRRIF: when the RRSP turns aroundThe RRSP is an accumulation account: deductible money goes in, and it grows there shielded from tax. But it is not designed to last forever.
  11. Step 18Fees and taxesThe CAD/USD exchange rate: why your return is not the security'sHolding a US security means making two investments at once: one in the security, and one in the US dollar.
  12. Step 19Reading statementsReconciling Everyfolio with your statement: quantities, average cost, normal gapsComparing what Everyfolio shows with what your broker shows is a healthy reflex — it is in fact the best check on your entries.

Stage 3

Going deeper

What takes more perspective: tax on gains and losses, foreign dividends, the margin account, reading returns and the advanced-mode indicators.

6 PremiumSee the steps
  1. Step 20Registered accountsRRSP or TFSA: the logic of the choice"RRSP or TFSA?" is probably the most asked question in Canadian saving. This article does not answer it — no one can answer it without knowing your situation.
  2. Step 21Registered accountsThe margin account, demystifiedPremium
  3. Step 22Market mechanicsThe liquidity of a securityThe liquidity of a security is the ease with which it can be bought or sold without moving its price.
  4. Step 23Fees and taxesCapital gains, the full mechanicsThe capital gain is the most discussed tax in investing — and one of the most misunderstood.
  5. Step 24Fees and taxesThe superficial loss ruleSelling a security at a loss, then buying it back right away: the manoeuvre looks harmless, and it is exactly the one the superficial loss rule targets.
  6. Step 25Fees and taxesWithholding tax on US dividendsA US dividend paid to a Canadian resident normally does not arrive whole: part of it is withheld at source, in the United States.
  7. Step 26Fees and taxesCanadian, US and foreign dividendsPremium
  8. Step 27Reading statementsReturn, in all its forms“What is my return?” has several right answers: two honest calculations, applied to the same portfolio, give two different figures.
  9. Step 28Reading indicatorsTrend indicators: moving averagesPremium
  10. Step 29Reading indicatorsMomentum indicators: RSI and MACDPremium
  11. Step 30Reading indicatorsVolatility indicators: Bollinger BandsPremium
  12. Step 31Reading indicatorsVolume indicatorsPremium

Create an account to track your progress.

These articles explain mechanisms and concepts. They never recommend a security, a fund or a moment — informative, general content, not personalized advice.

Understand your portfolio. Learn to invest.

An account lets you mark what you have read, answer the challenges and follow the path. Reading requires nothing.

Create an accountSign in