TSX Venture Exchange

The TSX Venture Exchange was founded on the 29th of November, 1999 under its original name, the Canadian Venture Exchange (CDNX). It was created through an agreement between Alberta, Montreal, Toronto, and Vancouver exchanges in a bid to restructure capital markets in Canada. To create CDNX, both the Vancouver and Alberta stock exchanges merged, and the focus of CDNX became junior companies. These are the companies that do not reach all of the requirements necessary to be listed on the Toronto Stock Exchange (TSX), but still have something to offer for investors.

Many of the companies listed on the exchange in its early days were resource exploration companies and new high technology ventures. This meant that their assets and their market and business capitalisation weren’t big enough to be listed on TSX, but the fact they were operating in high-growth parts of the economy meant that creating an exchange where their stocks could be listed was justified.

The TSX Venture Exchange has its headquarters in Calgary, Alberta, but it does not have the traditional ‘trading floor.’ This is because all trading through the Exchange is completed electronically. It does, however, have other offices in Montreal, Toronto, and Vancouver.

The name ‘Canadian Venture Exchange’ lasted only two years, as the TMX Group purchased the CDNX in 2001 and renamed it the TSX Venture Exchange. By this point, the small-cap portion of the equities market of the Bourse de Montreal (MSE) and the Winnipeg Stock Exchange had already merged into the CDNX and so became part of the newly named TDX.

The main index tracking the performance of the TSX Venture Exchange is the S&P/TSX Venture Composite Index. This index is used as a broad market indicator for the TSX Venture Exchange, as it lists Canadian companies that don’t reach the criteria needed to be listed on the Toronto Stock Exchange but are listed on the TSX Venture Exchange.

In addition to the S&P/TSX Venture Composite Index, the TSX Venture 50 is an index of the most popular and strong-performing stocks on the TSX Venture Exchange. There are some requirements that companies have to meet to be included in the TSX Venture 50. These include, being listed for more than a year, having a market cap of more than C$5 million, having a closing share price of higher than C$0.25 on the 31st of December of the prior year, and a share price of at least C$0.10 at the end of the year before.