How to Buy TSX Stocks and Invest in the TSX | Finder Canada (2024)

The Toronto Stock Exchange (TSX) is a major global stock market based in Canada. It deals primarily with energy and financial companies, such as Canada’s largest banks and a number of oil and gas companies. Find out how invest in the TSX, and learn more about how to buy a TSX stock online.

How to invest in the TSX

Follow these steps to set up an account and buy TSX stocks:

1. Choose a broker or trading platform. Research brokers or trading platforms that give you access to the TSX or at least lets you buy and sell the TSX stocks that you’re interested in. Compare these brokers by account types, investment options and trading fees.
2. Open a stock-trading account. Complete an online application by supplying personal information, such as your full name and address, phone number, Social Security number and date of birth.
3. Fund your account. Link your bank account to your trading account to initiate a transfer. Some platforms may allow you to pay with a credit card, debit card or online bank transfer.
4. Buy stocks on the TSX. Research and choose the assets you want to invest in on the TSX.

What is the TSX?

The Toronto Stock Exchange (TSX) is a stock exchange based in Toronto, Ontario. It’s Canada’s largest stock exchange, and the 9th largest exchange in the world by market capitalization. There are over 1,500 companies listed on the TSX, including a high proportion of those specializing in the financial and extractions industries.

You can use the TSX to trade shares in companies, investment trusts and exchange-traded funds (ETFs). As a more advanced trader, you can also use it to dabble in bonds, commodities, futures, options and other derivative products. Just be aware that any trades you make on the TSX will be carried out using the Canadian dollar.

Popular TSX stocks to buy

One good way of finding the most popular stocks on the TSX is by looking at the S&P/TSX 60 Index, which lists 60 of the largest companies on the exchange by market capitalization. The top 10 stocks by index weight as of May 2024 are:

Company Name	Stock symbol	Industry	YTD Performance*
Royal Bank	RY	Banking	-7.86%
TD Bank	TD	Banking	-15.28%
Shopify Inc	SHOP	Software	3.87%
Canadian Natural Resources Limited	CNQ	Oil and gas	18.27%
Enbridge	ENB	Oil and gas	3.45%
Canadian Pacific Kansas City Limited	CP	Railroads	5.04%
Canadian National Railways	CNR	Railroads	2.69%
Bank of Montreal	BMO	Banking	-3.29%
Brookfield Corporation	BN	Asset Management	11.74%
Scotiabank	BNS	Banking	-0.23%

*Year-to-date (YTD) stock data was collected on May 6, 2024.

How to buy TSX stocks

The following stock trading platforms provide access to stocks listed on both the Toronto Stock Exchange and US stock exchanges.

How much does it cost to buy TSX stocks?

Trading costs are set by the broker, so the cost to trade TSX stocks will depend on the broker you use to invest. Most US brokers no longer charge commissions to trade US-listed stocks and ETFs. So if the TSX stock is also listed on a US exchange, you can expect to avoid commissions. However, if you’re using a broker that offers direct trading on foreign exchanges, expect to pay a commission. For example, Charles Schwab charges $6.95 per online trade of Canadian stocks.

Other investment options on the Toronto Stock Exchange

There are a number of other investment products available on the TSX besides equities:

• Index funds. These track the performance of a “basket” of stocks on the TSX, and let you earn money on the average gains of all the shares put together.
• Exchange traded funds. ETFs are similar to mutual funds, except they can be traded on the stock exchange and typically come with much lower trading fees.
• Options. Options are a type of contract that let you speculate and bid on how an asset is going to perform on the stock market.
• Bonds. Bonds allow you to lend money to governments or corporations so that you can collect a set rate of interest on your loan.
• New issues. New issues give you the change to invest in a company going public for the first time so that you can get in on the ground floor before share prices go up.

Why should I invest in TSX Stocks?

The Toronto Stock Exchange is the largest stock exchange in Canada and features stocks from several major Canadian companies. It even offers access to certain stocks and securities that aren’t listed in other markets. In particular, it attracts some of the world’s largest natural resources companies, which makes it popular with international investors.

The TSX may be a good fit for you if you want to invest in banks, oil and gas companies or large Canadian corporations with at at least $7.5 million in net tangible assets. To invest in smaller Canadian companies, you’ll need to explore the TSX Venture Exchange (also known as the TSX-V).

Is now a good time to buy TSX stocks?

While it’s impossible to predict what will happen in the future, you may want to consider investing in strong stocks that are likely to withstand any future market fluctuations, like blue chip stocks.

To find these stocks, you’ll need to do some research and be aware of what’s going on in particular sectors. You can also make better decisions by tracking the historical trends of stocks and forecasting which companies have fared well throughout the pandemic, as well as which stocks could be on the verge of making a comeback.

Bottom line

The TSX lists stocks from over 1,500 Canadian companies, making it Canada’s largest stock exchange. To buy and sell TSX stocks, you need a brokerage that provides access to Canadian stock exchanges.

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Frequently asked questions

How can I buy TSX stocks online?

You can buy TSX stocks online by signing up for an online brokerage account such as Interactive Brokers or Fidelity Investments. These accounts will let you invest in TSX stocks using your desktop or mobile phone.

Can I buy US stocks through the TSX stock market?

Some US-based companies may list stocks on the TSX, although most list on US exchanges like the NYSE and Nasdaq.

What’s the best way to invest in the TSX?

The best way to invest in the TSX is to sign up for an online brokerage account or robo-advisor that provides access to international investments. You can also invest in TSX stocks using a financial planner, though this often comes with higher management fees than if you manage your own investments.