The Toronto Stock Exchange, or TSX trading centre, is the eighth largest stock exchange in the world in terms of market capitalisation and one of the biggest in North America. The Toronto Stock Exchange is listed under the name TSX and is part of the TMX Group. Read on for a brief history of the TSX, key information like opening hours and some ideas and tips to start trading on the Toronto Stock Exchange. We have also listed the best brokers for trading on the Toronto Stock Exchange below.
The Toronto Stock Exchange was officially created in the mid-1800s and incorporated in 1878 under the name Toronto Stock Exchange or TSE. Besides a three-month break during World War I, it has operated continuously since then.
The Toronto Stock Exchange abandoned its trading floor in 1997, becoming a platform for electronic trading. In 2002, the abbreviation TSE was changed to TSX, as it remains today.
On the TSX trading centre, you can trade shares of listed companies and derivative products like options or futures. The section of the TSX that deals with smaller stocks is called TSX Venture and operates similarly to the TSX trading centre. Recently, the TSX group has launched TSX Alpha, which works with fixed-income products like treasury and corporate bonds and acts as an alternative trading system.
Companies Listed On The TSX
Canadian stocks have a market capitalisation of about USD 3.16 trillion, which accounts for 4% of the world’s market capitalisation. As of 2020, there were over 1,500 companies issuing shares on the TSX trading centre, many focusing on energy, materials and financial services. These include Suncor, an oil refinery that manages pipelines across the world, Barrick Gold, one of the world’s largest gold mining companies, and the Royal Bank of Canada. You can look up the trading symbols for each company on the TSX website.
On the Toronto Stock Exchange, you can trade stocks for companies known around the world, like Blackberry, as well as small-cap stocks via the TSX Venture. You can also invest in bonds, exchange-traded funds (ETFs) and commodities.
When TSX trading, the tick size increment is measured in Canadian dollars (CAD) or cents. Stocks generally trade in one-cent tick size increments, while currencies have tick sizes in pips.
The board lot sizes for the TSX trading centre and TSX Venture are 100 for stocks priced at $1.00 and over, 500 for stocks priced at $0.10 to $0.99 and 1,000 for stocks priced under $0.10
TSX Trading Hours
TSX trading hours for 2021 are similar to other stock exchanges. The exchange is open for continuous trading from 09:30 to 16:00 Eastern Time (this corresponds to 07:30-14:00 in Mountain Time, 06:30 – 13:00 PST or 21:30 – 04:00 in Asian trading hours).
The TSX has a premarket trading period (early trading) from 07:00 – 09:30 ET, where orders can be entered but will not be executed until the market opens. You can also trade after hours (extended trading) on the Toronto Stock Exchange in the last trading session between 16:15 and 17:00 ET, though liquidity will be limited and prices will be less transparent. You can check the TSX trading centre website for after-hour trading quotes. No overnight trading is allowed on TSX outside these hours.
The TSX trading opening hours apply to all assets, including futures, stocks like BB and indices like S&P. TSX Venture has the same trading hours as TSX. However, TSX Alpha trading hours are slightly different – you can trade continuously from 08:00 to 17:00 ET, with an aftermarket trading session from 17:00 – 17:30 ET.
TSX Trading Holidays
All three parts of the stock exchange close on weekends and some Canadian and US national holidays. The TSX trading hours are reduced on Christmas Eve (24/12), closing at 13:00 ET, but remain unchanged on New Year’s Eve (31/12). Non-trading days on TSX include the Canadian and US Thanksgiving days and Canada Day.
If you are unsure or want to ask “is the TSX trading on Monday”, for example, check the Toronto Stock Exchange trading schedule and calendar for more info on 2022 trading days, key dates and to see if TSX and other exchanges in the TMX group are trading today.
TMX Trading Halts
TMX sometimes implements short trading pauses, with each known as a trading halt or suspension. These can happen for the whole market or just particular stocks and can affect the TSX, TSX Venture or both. The Toronto Stock Exchange implements trading halts when important news that could significantly alter prices are about to be released to the public, giving investors time to reflect before executing any positions.
The TSX trading halt rules also state that a stock can be suspended if there are fast unexplained fluctuations in price. If trading on the TSX is stopped or halted today, you will receive a notification via your broker before it starts and another before the halt has ended. Very rarely, TMX exchanges will close trading early due to technical problems.
How To Trade On The TSX
So how can you get started on the TSX trading centre? You will first need to find a broker that suits your trading style. If you are trading from outside of Canada, there are some extra considerations.
All trading on the TSX happens online. To trade on the Toronto Stock Exchange, you will need to find a broker that gives you access to TSX and TSX Venture. You can find companies that work directly with the TSX trading centre by looking at the TSX website, where you can identify the brokerage trading number. If you cannot find your broker of choice, do not panic – most brokers will trade with these companies instead of working directly with TSX.
Brokers around the world will allow you to trade on the TSX. Here are a few things to consider when choosing your broker:
- Regulation: Finding a broker that is regulated in your country will ensure you are protected. Brokers registered with the IIROC (Investment Industry Regulatory Organization of Canada) are likely to use TSX stocks. There are some scams to look out for, such as TMX Timex Trading, which have collected large sums of money from people. Choose a trustworthy, reputable broker before investing any real capital.
- Platform: The best trading platform for trading on the Toronto Stock Exchange will depend on your trading strategy and frequency. If you are looking at day trading on the TSX, you will want a broker with a trading app that allows you to trade anywhere, anytime. If you are instead interested in long-term or swing trading in TSX stocks, you may want access to a trading platform with comprehensive technical tools. Having access to a TSX trading API will allow you to get live data and integrate it with your own analysis.
- Fees: TMX has their own trading fees for brokers and companies, including a fixed fee per share in odd lot and extended trading. These fees apply to both the TSX and TSX Venture. Your broker will likely apply their own fees and spreads on top of this, so make sure you compare them thoroughly to get the best possible deal.
- Products: Before you choose a broker to use on the TSX trading centre, make sure that your desired financial products are available. When buying and selling stocks only, basic access to TSX will do. To trade with small-cap stocks (also known as penny stocks) you will need access to TSX Venture. If you are more experienced and looking to trade derivatives on TSX, like futures or options, check the broker’s website to see if this is available.
- Accounts: Many brokers will offer several account types, so choose one that suits your trading style and allows you to trade on the TSX. Some trading accounts will be spread-based, while others will be commission-based. Demo accounts act like a trading simulator in which you can practice TSX trading and test new strategies, known as paper trading. TMX also offers their own demo trading service, which includes stocks and options, on their website.
- Customer Support: Stock and index trading can prove extremely risky if large amounts of capital are invested. If you encounter an error, it is important to have a helpful and responsive customer support team on your side. Good customer service can be gauged using online reviews and by testing it out yourself with any questions you may have.
See our full guide to selecting a broker here.
Understanding The Market
To maximise your profits, it is important to track the evolution of TSX trading stocks. You should consider looking at the following:
- Indices: Indices are groups of assets that you can trade together. In Canada, the S&P/TSX Composite Index is the headline index, comprising around 250 companies. Tracking the performance of this index is important for understanding the state of the Canadian market. You can find some of the most important stocks on the TSX trading centre by looking at the S&P/TSX 60. Index charts are available within the TSX website and on tools like TradingView. You can trade derivates on subindices like S&P/TSX 60 and sector-specific subindices like the S&P/TSX Capped Energy Index.
- Trading Data And Reports: TMX regularly publishes trading data, including market summaries, statistics, trading volume charts and daily volumes for each symbol on the Toronto Stock Exchange. The TSX also publishes daily trading reports that will give you more information on the day-to-day changes in the market. You can see the trading price of individual stocks on the TSX, like BB or BMO, using tools like Trading View.
- Insider Trading: Insider trading occurs when executives trade shares in their own company. Looking at insider trading reports published by the Toronto Stock Exchange can give you an idea of where each company is headed. Insiders can trade on the TSX if they follow the insider trading policy, which stipulates those insiders should be registered on an insider list and report all their trades. Unregulated insider trading is illegal in Canada.
- Education: There are plenty of resources on how to trade stocks, many of which focus on the TSX trading centre. You can find manuals and courses online, explore live TSX and S&P information on sites like Trading Economics and connect with other TSX investors via Reddit and social media. Furthermore, the TSX/TMX Equities Trading Conference provides an opportunity to learn about the Canadian market and TSX. Using a demo account is also a smart way to learn and practice; TMX regularly organises trading competitions using the TSX options simulator.
These are some examples of trading strategies for the TSX:
Day trading involves opening and closing positions within the same trading day. You must keep in mind the TSX trading hours, including early and extended sessions. Note that there is a day trading rule in the US that requires you to have a balance of at least $25,000 for what they call ‘pattern trading’. There is no minimum in Canada but, if you are trading on the TSX from the US or with US stocks, this may be required. The best stocks for day trading on the TSX are those that have strong daily price fluctuations.
In swing trading, you hold a position for days or weeks until the trend changes and you reverse your position. Swing trading is based on technical analysis, so ensure you find a broker with a wide range of tools to swing trade on the TSX. The best stocks for swing trading on the TSX will present medium-term trends.
News announcements can strongly influence price movements in the TSX trading centre. Stay tuned into the news by looking at economic calendars and getting live notifications so you can make a move before the rest of the market does.
You can use trading bots or algorithmic software to trade automatically on the TSX. These programs will execute trades according to rules you have defined, allowing you to profit from market movements even when you are not looking, though be sure you manage your risk accordingly.
TSX Trading From Abroad
Trading on the TSX is carried out in the local currency, the Canadian Dollar (CAD). If you are trading from abroad, you will need to convert your currency to Canadian Dollars before you begin, which might entail a conversion fee.
There is one exception to this: interlisted stocks. These are listed both on the TSX trading centre and a US-based exchange, like NASDAQ. The major advantage of interlisted stocks is that they can be bought with US Dollars. Over 180 TSX stocks can be traded in USD and over 75% of the S&P/TSX 60 stocks are interlisted.
Final Word On TSX Trading
The Toronto Stock Exchange has some exciting companies and a solid performance record. You can trade on the TSX from most North American brokers, so make sure you compare them thoroughly in terms of platforms, fees and other factors to find the best one for you. Remember to check the TSX trading hours and holidays, including how they convert to your time zone, and watch out for any trading halts. A solid trading strategy and robust risk mitigation steps are key to profitable trading on the Toronto Stock Exchange. If you are keen to get started, you can find our recommended list of top brokers for Toronto Stock Exchange trading here.
Is It A Good Idea To Trade On The Toronto Stock Exchange?
The Toronto Stock Exchange (TSX) trading centre is the eighth largest stock exchange in the world and one of the biggest in terms of mining and energy companies. It has a solid performance record and list well-known companies, both of which make it a good exchange to trade on. You will need to trade with Canadian Dollars, which may require conversion fees, but you can also trade interlisted stocks in USD.
Which Are The Best Stocks On The TSX?
Some well-known companies are listed on the TSX trading centre, including Blackberry, Suncor, Barrick Gold and the Royal Bank of Canada. The best stocks on the TSX for you will depend on your strategy – you might want to consider day trading, swing trading or penny stock trading.
Which Are The Best Brokers To Trade On TSX?
Many Canadian and international brokers allow you to trade on the Toronto Stock Exchange but you will need to do some research to find the one that is best for you. Compare each broker’s fees, platforms and assets to make sense of the competition. Interactive Brokers, Trading 212 and Avatrade are some of the best-rated stockbrokers in Canada.
What Are The TSX Trading Hours?
The TSX is open for trading from 09:30 to 16:00 Eastern Time every day, except weekends and holidays. Early trading is allowed from 07:00 – 09:30 ET and extended trading occurs between 16:15 and 17:00 ET.
Can I Trade On TSX Using USD?
The only valid currency on the TSX trading centre is the Canadian Dollar. However, some stocks on the TSX are interlisted, which means they are also available on a US exchange and can be traded with USD.
Can I Access TSX Trading Reports?
Yes. The Toronto Stock Exchange publishes daily trading reports, statistics and data with the latest information about the market. You can also access insider reports through the exchange.
Where Can I Find Out More About TSX?
The TSX website offers a wealth of information on all things TSX. Here, you can find out about insider and NCIB trading rules, broker trading numbers, daily trading volume and alternative trading systems. You can also login to the TMX trading simulator.