Born 160 years ago to humble beginnings, the TSX is now one of the world’s premier stock exchanges and is receiving surging interest on the back of improving commodity prices, new technology stocks and the current global “gold rush”.
Founded in 1861 and initially listing only 18 stocks, the Toronto Stock Exchange (TSX) now hosts more than 1,500 listed companies, covering everything from mining, energy, technology, and real estate sectors.
Officially incorporated in 1878 under the name Toronto Stock Exchange or TSE, it became known as the TSX after the company was rebranded in 2002.
The TSX is operated by Toronto-based financial services company, the TMX Group, which also controls the TSX Venture Exchange, Montreal Exchange, and TSX Alpha Exchange. TSX officially changed its name to the TMX Group in June 2008.
In the early 2000s, TSX assumed ownership of the Canadian Venture Exchange (CDNX) and renamed it the TSX Venture Exchange.
Growing listing interest
While many tipped stock exchanges would continue to suffer due to the ongoing global pandemic, the TSX and TSX Venture are going from strength to strength.
In March 2021, the TSX welcomed 27 new issuers compared with 10 in March 2020, including one mining company. Total financings raised in March 2021 represented an increase of 114% from March 2020. The total number of financings in March 2021 was 81, compared with 42 in the same period last year.
At the same time, the TSXV welcomed nine new issuers in March 2021, compared with five in March 2020. The new listings included five mining companies. Total financings raised in March 2021 were up 498% from March 2020.
While many tipped stock exchanges would continue to suffer due to the ongoing global pandemic, the TSX and TSX Venture are going from strength to strength.
New initiatives
One of the reasons the TSX has been able to maintain its high rating after such a long period is its willingness to innovate and move with the times.
In February it announced the world’s first bitcoin exchange traded fund (ETF), Purpose Bitcoin ETF, which began trading under the symbols TSX:BTCC.B (Canadian dollar denominated ETF non-currency hedged units) and TSX:BTCC.U (U.S. dollar denominated ETF non-currency hedged units).
Loui Anastasopoulos, President, Capital Formation and Enterprise Marketing Officer for TMX Group, said Purpose Bitcoin ETF is the first direct custody bitcoin ETF in the world, and is designed to provide investors with exposure to the leading cryptocurrency by investing directly in physically settled bitcoin.
“On behalf of Toronto Stock Exchange, I’d like to congratulate Purpose Investments, a true industry pioneer, on this huge achievement,” Mr Anastasopoulos stated in announcing the new product launch.
“The launch of trading in the world’s first publicly listed bitcoin ETF establishes another important milestone for Canada’s markets as we strive to innovate to serve the evolving needs of clients across our marketplace.
“As the ETF industry and the broader investment landscape continues to expand and new sectors like blockchain and cryptocurrency and others emerge, we would like to acknowledge the dedicated efforts of stakeholders across our world-leading ecosystem, including regulators, for working to ensure Canada remains a leading marketplace for companies to access growth capital and for investors to participate in that growth.”
Som Seif, Founder and CEO of Purpose Investments, said this innovation for investors will make the process of owning Bitcoin easier than ever.
“We believe Bitcoin, as the first and largest asset in the emerging cryptocurrency ecosystem, is poised to continue its growth trajectory and adoption as an alternative asset, further cementing the investment opportunity it presents,” said Mr Seif. “Driving forward to be the leader in cryptocurrency investing is a testament to Purpose’s goal of providing investors with alternative investment solutions that are not based off of traditional benchmarks.”
As the ETF has grown into a leading global investment vehicle, the Canadian ETF market has remained at the forefront of the industry. At year-end 2020, there were 794 ETFs listed that held almost C$250 billion in assets under management (AUM).
At the end of last year, the TSXV brought in changes to its Capital Pool Company (CPC) programme, following extensive consultation with stakeholders across the TSXV community. The CPC programme is a unique listing vehicle exclusively offered by TSXV and accounted for almost 50% of new TSXV listings in the past 10 years. New changes to the policy will provide:
- Increased flexibility – new jurisdictions added, residency restrictions eased, spending restrictions simplified
- Reduced regulatory burden – relaxed requirements on shareholder distribution and shareholder approval, fewer restrictions on PRO subscriptions
- Improved economics – increased seed investment, finders fees, shorter escrow
“The CPC programme is a unique, innovative go-public vehicle tailored to serve the needs of growth companies in all sectors and is the leading source of new listings on TSX Venture Exchange. We are proud of the programme’s long track record of success in expanding opportunities for companies to access public growth capital,” Mr Anastasopoulos said.
“As the Canadian financial landscape continues to evolve, we recognize the importance of working together with our clients and stakeholders to ensure the services and solutions we provide to enable success remain relevant. We thank our partners across the community for working with us to identify significant ways we can enhance the CPC programme and make these important policy changes.”
It is this willingness to evolve and work with its clients, that has made the TSX a world leader in the global financial markets after 160 years.
