The TSX30: The Hard & High Sell on Cannabis
Investors mulling recent headlines focusing on any downward cannabis trends may be wondering how well the market is actually doing … a new recognition program launched by the Toronto Stock Exchange could prove that cannabis is not only here to stay, but here to thrive.
Announced late last week, the TSX30 is a means for Canada’s main stock index to get into the indexing game by creating a Canadian equivalent to the DJIA30. This new index highlights newer-and-established listed firms from 583 eligible Canadian companies.
Unlike the TSX60, which tracks the largest companies trading on the TSX, the TSX30 is a reflection of the best performers over the past three years, based on dividend adjusted price appreciation. These are stocks that have returned at least 126% to investors and cannabis is well represented with 11 companies featured, many in the top 10. This new listing has an entirely different purpose to the established 60 and many companies listed on the 30 are not found on the 60.
TMX Group’s President, Capital Formation, Loui Anastasopoulos explained to media that the TSX30 includes - “Companies operating in traditional areas of strength like natural resources and also in newly defined sectors like clean tech and cannabis.”
At the time of announcement, #1 on the inaugural list was cannabis company Canopy Growth Corp (TSX: WEED) , which netted total returns of 1,823% for investors, more than double than second-place Shopify Inc. (TSX: SHOP) . The list also sees the likes of Air Canada (TSX: AC) and the Great Canadian Gaming Corporation (TSX: GC) .
This is an annual recognition program similar to the TSX Venture50 that has been running from nearly 15 years. The intent does not appear to tread on the S&P 500’s marketshare, nor is it created in a similar fashion to the old tech-heavy TSX35.
You can find out more about the new TSX30 and see the full list of companies by visiting its website at www.tsx.com/tsx30.