What are the different Canadian stock markets and exchanges?

Canadian exchanges account for 3% of the world's $107 trillion equity market, a figure that, while smaller compared to the size of markets in other countries, still represents over $3.5 trillion USD – a significant amount.¹, ²

The majority of stock market activity in Canada takes place across four major exchanges: 

• the Toronto Stock Exchange (TSX)
• the Toronto Stock Venture Exchange (TSXV)
• the Cboe Canada, formerly known as NEO Exchange (Cboe Canada)
• the Canadian Securities Exchange (CSE)

These stock exchanges serve as platforms where buyers and sellers gather, primarily online, to trade a variety of financial instruments. They provide a regulated space for trading securities, ensuring transparency, and fair pricing. They also facilitate market operations and set rules to protect investors and companies listing shares.

Each exchange in Canada has its own strengths, focusing on specific kinds of stocks and exchange-traded funds (ETFs), offering investors different ways of making trades. 

So, what sets them apart, and how do they compare? Let's take a closer look.

What is the Toronto Stock Exchange (TSX)?

The Toronto Stock Exchange (TSX) is Canada's largest and most significant stock exchange, handling most of the country's trading volume. It is home to well-established, large-cap companies that operate across various sectors, including finance, energy, and mining.

The TSX is a fully electronic exchange, with all transactions conducted in Canadian dollars. It ranks as the tenth-largest stock exchange globally and the third largest in North America, following the New York Stock Exchange (NYSE) and Nasdaq.³

Known for its strict listing requirements, the TSX only allows companies that meet specific size, regulatory, and disclosure standards to list and trade shares.⁴ The TSX also boasts the largest number of listed ETFs in Canada. As a result of the TSX's size and reputation, it serves as the Canadian hub for global investors. 

Additionally, the Montreal Exchange (MX) is a wholly owned subsidiary of the TMX Group and is dedicated to fostering the growth of the Canadian derivatives and futures market. Many large- and mid-cap companies listed on the TSX also list their options on the MX. 

Companies listed on the TSX are identified by stock ticker symbols such as “TSX”, “TSE”, or “TO”. To learn more about this exchange, visit the TSX website (external link).

What is the TSX Venture Exchange (TSXV)?

The TSX Venture Exchange (TSXV) serves as a launchpad for smaller, early-stage companies, often in industries like mining and technology. It offers these emerging enterprises a platform to access capital and grow.

Companies listed on the TSXV have the opportunity to “graduate” to the Toronto Stock Exchange (TSX) if they achieve significant growth in assets and working capital and meet a range of other stringent requirements. The transition is referred to as “graduation” because it is an indication of a company's maturity and stability, as it must meet higher standards for market capitalization, shareholder equity, revenue, and corporate governance.

Graduating to the TSX provides several advantages:

• Increased visibility – A TSX listing elevates a company’s profile within the investment community.
• Access to a broader investor base – Listing on the TSX attracts more investors, including institutional investors with substantial capital to deploy.
• Enhanced liquidity – A TSX listing can lead to more active trading of the company’s shares.

For companies seeking to raise capital and build investor confidence, graduating from the TSXV to the TSX is a significant milestone.

Companies listed on the TSX are identified by the stock ticker listing symbol “TSXV”. To learn more about this exchange, visit the TSXV website (external link).

What is the Chicago Board Options Exchange (Cboe Canada exchange)?

The Cboe Canada exchange, formerly known as the NEO Exchange, is Canada's third most active market, accounting for nearly 15% of all trading volume in Canadian-listed securities.⁵ Owned by the Chicago Board Options Exchange, this Canadian subsidiary focuses on equity and ETF trading but does not support options trading.

Cboe Canada listings focus on mid-sized companies, exchange-traded funds (ETFs), and innovative investment products like Canadian Depository Receipts (CDRs). CDRs offer Canadian investors a unique opportunity to invest in publicly traded U.S. companies while transacting in Canadian dollars, reducing currency conversion complexities.⁶

By introducing innovative investment solutions like CDRs, the Cboe Canada exchange continues to expand access to global markets for Canadian investors.

Companies listed on the TSX are identified by the stock ticker symbol “Cboe Canada”. To learn more about this exchange, visit the Cboe Canada website (external link).

What is the Canadian Securities Exchange (CSE)?

The Canadian Securities Exchange (CSE) serves as an alternative stock market tailored to emerging, smaller, and entrepreneurial ventures. It is particularly popular among up-and-coming fintech companies and businesses with a strong presence in emerging markets.

The CSE's less demanding listing requirements make it appealing to early-stage enterprises seeking to raise capital. Compared to the stricter criteria of larger exchanges like the TSX, the CSE provides an accessible platform for companies that might struggle to meet the requirements set by the larger exchanges. 

Companies listed on the TSX are identified by stock ticker listing symbols such as “CSE” and “CNSX”.

To learn more about this exchange, visit the CSE website (external link).

How do you find stocks and their exchanges? 

To find stocks and their exchanges, you can visit the exchange's website to view listed companies. However, most investors start their research using tools like Google Finance, financial news platforms, or their direct brokerage platform by searching for a company name. 

If you don’t already have one, your first step is to open a brokerage account. Then, transfer funds into your account to buy stocks and other financial products such as bonds, ETFs, index funds, and options.

Investors can find stock quotes and the exchanges they are traded on by searching their ticker symbol. For example, National Bank's stock ticker symbol is “NA”. If you look up a stock quote on any number of platforms, you will typically see the full name of the company (e.g., National Bank of Canada) followed by the ticker symbol (e.g., NA). This is separated by a colon, hyphen, or space followed by a symbol for the exchange where the stock is traded - TSE, TO, TSX, or CN - designating the Toronto Stock Exchange.

This is often accompanied by an exchange designation:

• NA - TSE (Google Finance)
• NA.TO (Apple Stocks App)
• NA TSX Equity (RBC)
• NA:CN (Bloomberg)

Once you've decided to invest in a stock, the trade happens through a broker or an online brokerage platform that connects buyers and sellers. It is essential to keep in mind that some brokerage platforms charge commissions, while others, like National Bank Direct Brokerage, offer 0$ commissions on all online stock and ETF transactions.

What are the key difference between the TSX and other Canadian exchanges?

The Toronto Stock Exchange (TSX), TSX Venture Exchange (TSXV), Cboe Canada exchange, and the Canadian Securities Exchange (CSE) each serve different roles within North American financial markets, catering to different types of companies and investors. 

While all four exchanges contribute to Canada’s equity ecosystem, they primarily focus on specific markets and investor bases. The smaller exchanges compete to increase trading volumes and attract high-value listings of stocks and ETFs. Notably, a stock listed on one exchange does not mean the exchange has exclusive trading rights or that the stock is bound exclusively to that platform. In principle, a stock can trade on multiple exchanges simultaneously. This competition benefits investors by encouraging innovation, improving liquidity, and driving down the cost of buying publicly traded securities.

Investor base differences

• Toronto Stock Exchange (TSX) - Attracts institutional and retail investors looking for relatively stable investments in well-established Canadian and international companies.
• TSX Venture Exchange (TSXV) - Appeals primarily to investors with a higher risk tolerance who seek opportunities in emerging or high-growth industries.
• Cboe Canada - Attracts traders and investors interested in mid-sized companies, ETFs, and Canadian Depository Receipts (CDRs). The exchange tries to provide innovative investment vehicles that will appeal to retail Canadian investors, or those who want diverse tools for hedging, income, or speculative strategies.
• Canadian Securities Exchange (CSE) - Appeals to investors interested in speculative or high-growth opportunities, particularly in sectors that might not fit traditional exchanges, such as blockchain and fintech.

Market focus differences

• Toronto Stock Exchange (TSX) - Lists companies across various sectors, particularly in financial services, energy, mining, and materials.
• TSX Venture Exchange (TSXV) – Focuses on companies in industries like mining, oil and gas, technology, and biotechnology sectors.
• Cboe Canada - Includes options on individual stocks, indices like the S&P 500 and Dow Jones, ETFs, and CDRs.
• Canadian Securities Exchange (CSE) - Features companies in emerging industries such as cryptocurrency and technology, while also supporting traditional sectors like mining.

The table below summarizes the key differences between Canada’s stock exchanges outlined above:

While Canada's equity market may be smaller than some of its global counterparts, it remains a significant player in the financial world. Based on market capitalization, Canada ranks among the top 10 equity markets globally.⁷ The four major Canadian exchanges provide a diverse range of investment opportunities for both novice and experienced self-directed investors.

Understanding the differences between Canadian exchanges is crucial for developing a well-informed and effective investment strategy. Knowing where your money is going helps you make smarter decisions aligned with your financial goals. Take the time to research, choose an investment approach that suits your needs, and work toward achieving your financial goals!