Post by
CauseAndEffect on Dec 20, 2022 7:52pm
Selling Pressure
There is a lot of mention of MM's and shorters putting downward pressure on the stock price, but something else seems to have gone by without any discussions or considerations. As posted here at the beginning of the month, the S&P Dow Jones Indices were to make the following changes in the S&P/TSX Composite Index prior to the open of trading on Mon dec 19, 2022.
Deleted - Corus Entertainment Inc B Nvtg (TSX:CJR.B).
Correct me if I'm wrong, this means all ETF's that mirror the index need to liquidate their Corus shares because Corus has been dropped from the index. Questions: is there a timeframe this liquidation generally takes place within? Any idea as to how many index funds this involves? Any idea how many shares need to be sold off?
I believe even if Corus shares become eligible for inclusion in the index again, it takes something like 12 months before it can be re-instated.
Thoughts?
Comment by
YassineNoBS on Dec 21, 2022 3:50am
As far as I know the only ETF holding Corus entertainment is GWX (SPDR S&P International Small Cap ETF issued by state street). The amount they hold is around 360k which is around 180k shares. I don't think that is significant enough to cause any major moves and will be absorbed within this week if not already done.
Comment by
Catscratch on Dec 21, 2022 9:16am
Corus is pretty widely held by index funds and closet index funds. In my experience most of the selling occurs over the following 30 days. The other headwind of course is that now that Corus is out of the index the buying/demand from index and closet index funds will be gone for the being until/if they make if back into the index.