TORONTO — The Toronto Stock Exchange launches a global mining index Tuesday, hoping to draw investment from commodity-hungry stock buyers and cement its reputation as a leading market for mining companies.
TSX is launching the index in conjunction with Standard & Poor's, which administers the main Toronto indexes. It will track 107 issues traded on the Toronto Exchange, New York Stock Exchange and Nasdaq Stock Market.
“The launch of the S&P/TSX Global Mining Index is a natural extension of our role as the world's leading mining exchange group,” said Richard Nadeau, senior vice-president at TSX Group Inc. , which owns both the Toronto Stock Exchange and the TSX Venture Exchange.
TSX's exchanges are home to about 60 per cent of the world's public mining companies, although many of them are small start-ups listed on the venture exchange.
Initially announced in March, the index will include players in gold, base metals, coal, uranium and aluminum.
It will include global leaders like Anglo-American PLC, Companhia Vale do Rio Doce (CVRD), Barrick Gold Corp., Alcoa Inc. and Rio Tinto PLC, as well as smaller players.
The company on the new index with the largest market capitalization is BHP Billiton Ltd., with a market cap of $97.5-billion, while the smallest is DRDGold Ltd., at $318-million.
The index will be separate from the TSX capped metals & mining index , which tracks TSX-listed mining stocks.
Analysts said the new index will let investors get broad exposure to global mining stocks.
TSX expects investment dealers to offer investment products such as exchange-traded funds based on the index.
“On balance, these [products] have been very successful, and a lot of people use them to balance portfolios, and with that popularity, they've had big growth,” said John Kinsey, portfolio manager at Caldwell Securities in Toronto.
Already, Claymore Investments has said it will launch the Claymore S&P/TSX Global Mining ETF to coincide with the launch of the index.
The TSX launched a global gold index last year.
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