Glossary

H

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Halt in Trading
A temporary halt in the trading of a security to allow significant news to be reported and widely disseminated. Usually the result of a pending merger or a substantial change in dividends or earnings.

 

Hedge Funds
Lightly regulated pools of capital in which the hedge fund manager invests a significant amount of his or her own capital into the fund and whose offering memorandum allows for the fund to execute aggressive strategies that are unavailable to mutual funds such as short selling.

 

Hedging
A protective manoeuvre; a transaction intended to reduce the risk of loss from price fluctuations.

 

High Saling
Deliberately causing the last sale for the day in a security to be higher than warranted by the prevailing market conditions (also referred to as window dressing).

 

High Water Mark
Used in the context of how a hedge fund manager is compensated. The high water mark sets the bar above which the fund manager is paid a portion of the profits earned for the fund.

 

Holding Period Return
A transactional rate of return measure that takes into account all cash flows and increases or decreases in a security's value for any time frame. Time frames can be greater or less than a year.

 

Hypothecate
To pledge securities as collateral for a loan. Referred to as collateral assignment or hypotec in Québec for segregated funds.