S&P/TSX Composite Index (GSPTSE)

QUOTE AND NEWS
SeekingAlpha Jun 9
SeekingAlpha Jun 7
Motley Fool Jun 5
Shopify might be added to the S&P/TSX Composite Index. This could provide a boost to the share price.
SeekingAlpha Jun 5
Clusterstock Mar 14
Canopy Growth, a marijuana-growing company based in Ontario, is being added to the S&P/TSX composite index, The Globe and Mail reports. The company will be added to the index's healthcare sector and start trading on March 20. Shares were down...
newratings.com Jun 24
WASHINGTON (dpa-AFX) - Canadian stocks may pull back Wednesday morning after strong gains in the previous two sessions. Eurogroup finance ministers are scheduled to meet again later in the day to thrash out a deal with Greece to avoid...
newratings.com Jun 8
WASHINGTON (dpa-AFX) - Canadian stocks are poised for a quiet start to the week amid a lack of market-moving catalysts and ho-hum commodities prices. Stocks settled lower on Friday despite some upbeat jobs news from both side of the border. The...
Top Foreign Stocks Dec 29
I came across an interesting article titled  Stampede to the International Market by Edward Friedman, Senior Research Analyst at McLean&Partners of Canada. In the article Mr.Friedman discussed the importance of diversification for Canadian...
Canada.com Sep 30
Both the S&P/TSX composite index and S&P 500 are approaching oversold levels, which may present a buying opportunity
Mondo Visione Sep 25
S&P Dow Jones Indices (S&P DJI), one of the world’s largest providers of financial market indices, and Toronto Stock Exchange (TSX) today announced the launch of the S&P/TSX Composite Shareholder Yield Index and the S&P/TSX Composite Buyback...




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The S&P TSX composite index is a capitalization weighted index of the Toronto Stock Exchange. It's the main index for the exchange and covers over 75% of the Toronto Stock Exchange by market capitalization. It includes all common stocks and income trust units traded on the exchange.

Weighting and Calculations

The index is calculated on the basis of the market capitalization method. Instead of using a company's outstanding shares it uses its float, or shares that are readily available for trading. The free-float method, therefore, does not include restricted stocks, such as those held by company insiders.

So the formula would be[1]:

Index level= Σ(Price of stock* Number of shares)/ Index Divisor.

While one might track this portfolio’s value in dollar terms, it would probably be an unwieldy number – for example, the S&P 500 market value is roughly $11.8 trillion. Rather than deal with ten or more digits, the figure is scaled to a more easily handled number, currently around 1250. Dividing the portfolio market value by a factor, usually called the Index divisor, does the scaling.

Continuity in index values is maintained by adjusting the divisor for all changes in the constituents’ share capital after the base date. This includes additions and deletions to the index, rights issues, share buybacks and issuances, and spin-offs. The divisor’s time series is, in effect, a chronological summary of all changes affecting the base capital of the index. The divisor is adjusted such that the index value at an instant just prior to a change in base capital equals the index value at an instant immediately following that change[2].

Composition

Eligibility

To be eligilbile for inclusion in the Composite index[3] :

  • Market Capitalization: For eligibility any security must represent a minimum weight of 0.05% of the index. Moreover, the security must have a minimum weighted average price of atleast C$ 1 over the past three months and over the last three trading days of the month-end prior to the exchange reviewing the index.
  • Liquidity: The trading volume in terms of dollar value and the number of transactions must exceed at least 0.025% of the sum of all eligible securities' trading volume. To ensure that no single company dominates trading, they are capped at a maximum of 15% for value, volume and transactions.

Breakdown

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References

  1. Index Maths Methodology
  2. TSX Composite Description
  3. S&P Eligibility Criteria
  4. S&P description