MARGIN & SHORT

Margin accounts allow for increased flexibility when investing. They provide the investor with the option to purchase shares without necessarily having the funds for the full cost of the investment. This buying power is based on the cummulative loan value of the investments in the account, which in turn is based on each investment's value and quality. The amount is calculated from the market value of the securities either already in the account or to be acquired. Thus, the buying power may fluctuate depending on the type of security, as well as the market value of the security. See the table below for details.

Short selling involves selling a security that you do not own. Short sell orders can only be entered in margin-short accounts. The rules governing these transactions vary according to each North American stock exchange:

TSX : Short sales may be executed at the price of the prior trade.

NYSE: Short sales may be executed only on an up-tick (the last trade for a security must take place at a price higher than the previous trade).

NASDAQ and OTCBB: Short sales may be executed if the bid price is higher than the previous bid price.
 

Margin	Type of Security		% Loan Value
	Canadian & U.S. Equities1	$5 & over + Option eligible	70%
		$3 & over	50%
		$3 & over + sector concentration in the account2	40% to 50%
		Under $3	No loan value
	Canadian & U.S. Options		No loan value
	Mutual Funds		50%
	Fixed Income Securities	Corporate Bonds and Debentures	50%
		Municipal Bonds	95%
		Provincial Bonds	95%
		Commercial Paper & Bankers' Acceptances	90%
		Canada Bonds	96%
		T-bonds (CDN or USD) maturing in > 3 years	96%
		T-bills / T-bonds (CDN or USD) maturing in < 3 years	99%
Short Sales	Stock Value		Minimum Margin Required(as % of the market value)
	$5 & over + Option eligible		130%
	$3 to $4.99		150%
	$2 to $2.993		200%
	$1.50 to $1.993		$3 per share
	$0.25 to $1.493		200%
	Under $0.253		100% +  $0.25 per share