Overview of TSX and TSXV

Toronto Stock Exchange (TSX) ranks as one of the 10 largest stock exchanges in the world in terms of market capitalization. Investors around the world want exposure to Canadian-listed stocks, as the country boasts one of the most secure financial and banking systems in the world, a strong middle class, political stability, and an unrivaled entrepreneurial spirit.

Behind TSX is a smaller TSX Venture Exchange (TSXV) that caters exclusively to small and early-stage companies looking for alternative options to private equity or venture capital funding.

What Makes TSX and TSXV Attractive

Unlike many premier markets, TSX and TSXV cater to small- and mid-market companies looking for access to growth capital.

The average financing size for new TSX-listed companies in 2019 was $68 million, while the smaller junior exchange oversaw an average financing size of $2.7 million.

Given Canada’s close proximity to and economic ties with the United States, global companies also view Canada as a venue for reaching U.S. investors, both individual and institutional. In fact, a significant portion of the daily flow of trading volume in Canadian markets comes from U.S.-based investors.

Canada is also home to a highly diversified economy with notable strengths in manufacturing, financial services, energy, and technology. Canada was named by the Economist Intelligence Unit as the best country in the G-20 group for doing business. Source: TMX ‘2021 Guide to Listing, page 6

As such, global investors want exposure to innovative companies that operate in one of the world’s largest economies.

TSX and TSXV: Facts and Figures

As of December 31, 2020, TSX and TSXV were home to 3,289 public companies. The total market capitalization of all companies listed on the two exchanges stood at $3.477 trillion.

A total of 228 international companies are listed on a Canadian exchange, of which 20 were added in 2020. U.S.-based companies dominate global listings and account for 50% of all international listings, followed by the United Kingdom and Europe at 13, followed by Israel at 5%.

The average market capitalization of a TSX-listed company was $2.072 billion, while the average value of a TSXV-listed company was $47 million.

Shopify entered 2021 as the highest-valued Canadian-listed company and is on track to hold on to the title heading into 2022. At current prices, Shopify is valued at $260 billion after gaining around 50% in value since the start of the year.

Royal Bank of Canada held the title as Canada’s most valuable company until May, 2020 and has been demoted to second largest with a current worth of around $190 billion.

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Originally Posted on October 29, 2021 – Overview Of TSX And TSXV

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