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Toronto Stock Market - The Canadian Stock Exchange

Toronto stock market (TSX) is the largest stock exchange in Canada, third largest in America and among the biggest in the world as well.

The Toronto stock market is the largest stock exchange in Canada, and the eight largest in the world in terms of market capitalization. It lists over 4000 securities and trades about 250 million shares everyday. The listings of this exchange consist of companies from a variety of sectors. It not only lists the companies from Canada but from other countries as well. Originally this was a traditional floor-based and broker-assisted exchange but now it has converted into an electronically operated stock exchange.

The Toronto stock market is located in 130 King Street West in Toronto, Ontario. The different types of securities traded here are stocks, ETFs, debt securities, rights and warrants and income funds. TMX Group is the owner of this stock exchange. The currency used is CAD. It has a total listing of 3680 and a market capitalization of US $1.7 trillion as of August 2010.

Trading Hours

The normal trading hours of the Toronto stock market is from 9.30am to 4pm ET, Mondays to Fridays. Saturdays and Sundays are holidays. The exchange is also closed for trading on holidays such as New Year's Day, Family Day, Good Friday, Victoria Day Canada Day, Civic Day, Labor Day, Thanksgiving Day, Christmas, Boxing Day, etc. These holidays are usually declared by the Toronto stock market in advance.

There is an extended session for Participating Organizations, which is basically a post market session, from 4.15pm to 5pm ET on trading days.

Main Stock Indices

There is one main stock index of the Toronto stock market and that is the S&P/TSX Composite Index. This index lists the stock or equity prices of the largest companies that are listed on the stock exchange. These companies are ranked as per their market capitalization. This index comprises of about 70% of the listed companies in the Toronto stock exchange. Earlier, the TSE 300 Index was used instead of this one.

The other two minor index of the Toronto stock exchange are as follows:

  • S&P/TSX 60 Index - This index comprises of sixty of the largest companies listed with the Toronto stock exchange. The measurement is done on the basis of market capitalization. The S&P Index Committee of Canada maintains this index. At present, the index exposes ten industry sectors to its investors.
  • The S&P/TSX Completion Index - When this index is combined with the above index (S&P/TSX 60), the S&P/TSX Composite Index is formed.

Exchange History

The Toronto stock market is said to have descended from a group which was formed by businessmen from Toronto on 26th July 1852. This name of this group was the Association of Brokers. Unfortunately, no official records of the transactions conducted by this group can be recovered. It is said that on 25th October, 1861 a group of twenty four men went to the Masonic Hall in order to create the Toronto Stock exchange officially. In the year 1878 the exchange was incorporated in a formal manner by an act of the Legislative Assembly of Ontario.

In the year 1914, the exchange was shut down for a period of three months for the fear of financial panic on account of the First World War. In the year 1934, this stock exchange merged with one of its main competitors, the Standard Stock and Mining Exchange. After the merging was complete, the exchange chose to not change its name and continue operating as Toronto stock exchange only.

In the year 1977 Computer Assisted Trading System or CATS was introduced for quoting the less liquid equities. On 23rd April 1997, the trading floor of the exchange was closed and the exchange was converted into an entirely electronically operated stock market. In the year 1999 Barbara G. Stymiest was appointed as the President & Chief Executive Officer of the Toronto Stock Exchange.

Another important event that took place in the history of this exchange is its name change in the year 2001. In 2000 this exchange converted into a for-profit company and changed its acronym into TSX in 2001. This was one of the important and significant changes of the exchange.

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