In my article Five Reasons to Invest in Canada, I made it apparent that Canada is a country that foreign investors should look to for diversifying their portfolio. In this article I will focus on how to go about equity investment in Canada.
The primary exchange is the Toronto Stock Exchange (TSX) and its junior cousin, the Toronto Venture Exchange (TSX Venture). There are other stock exchanges in Canada such as the Canadian National Stock Exchange (CNSX), but those are often very small and illiquid and mostly feature penny stocks.
The TSX and TSX Venture are open from 9:30am to 4:00pm EST, the same time that the Stock Exchanges in the United States are open. Symbols to quote stocks on these exchanges are accompanied by a .to suffix for the TSX and a .v suffix for TSX Venture listings. For instance, Royal Bank's quote in the US is RY. To quote its price on the Canadian exchange its RY.to.
If your brokerage is unable to access TSX listed stocks, over 170 of them are available to trade in the US. Refer here for an entire list of stocks interlisted on the TSX and one of the American exchanges.
This list includes most of the biggest and most important stocks on the TSX, such as Canada's banks (CM, RY, TD, BMO, BNS), Canada's precious metals companies (YRI, G, ELD, K etc), oil and gas (SU, CNQ, ECA etc) and telecommunications (RCI.B, BCE, T.A).
While many of these interlisted stocks cover what a potential investor would be interested in investing in Canada, many of the small cap companies are not listed on the US exchanges or trade only as Over-the-Counter pink sheets. The TSX and TSX Venture listings' liquidity is far superior to the pink sheet listings and may be the only option if they are not on the pink sheets. If you are unable to place trades on the TSX with your broker I recommend first calling their client support and asking if they can provide you with the ability to trade on the Canadian exchanges. You may have to sign the appropriate waiver forms in order to make this possible. If they are unable to provide you with access to the Canadian markets, you may need to go with a brokerage that does. Some of these brokers include:
CIBC Investor's Edge
National Bank Discount Brokerage
Royal Bank Action Direct
Scotia Discount Brokerage
You should research one or more of these brokerages to see which one is appropriate for you.
Refer to my other investment articles if you are interested in learning about: