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Strategies & Market Trends : Underexposed Technical Analysis
AQN 5.810+0.7%Dec 10 3:59 PM EST
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From: Underexposed8/12/2019 1:38:37 AM
1 Recommendation

Recommended By
kimberley

   of 914
 
DIS: The difference between the Canadian and American Stock markets

Many people think there is not much difference between American and Canadian markets other than size. whe I started out I traded exclusively in Canadian stocks... then later I opened an a USD portfolio and used the same approach in buying stocks.... BIG MISTAKE.... In 3 years I successfully whittled $10,000 (a small test amount) to a couple of hundred dollars US.

It was not until I did a bit of research that I found out the reason for it.





The first thing that stands out is that Canadian have less choice when it comes to picking stocks (ETFs are not included in these totals for either country)

It seems that Canadians have less than half the number to choose from. I have not included sub-penney Canadian stocks or OTCB for American stocks. Neither areas are not frequented by serious investors

While that is the impression a casual glance at this chart gives.... it is far from the truth.

Canadians actually have more choice on several levels. Canadians do not have to have a special global account to access American stocks. We can place orders to buy or sell or option any American stock placing our order through our normal broker at the same commission rates (though in USD) as cost us for Canadian stocks.

Americans don't have that luxury .... if they want access to Canadian stocks they would have to have a Global account at higher fees... their normal brokers don't touch Canadian stocks unless they are listed on an American exchange.

Canadian Exchanges [TSX, TSX-V] have far and away more Basic Material stocks ...1297... compared to 294 for the main American exchanges [NYSE, NASDQ, AMEX]

Canada leads the world in listings for Mining as well as Oil & Gas... The American exchanges basically has large Basic stocks whereas a lot of our Basic material stocks are startups.

On the other hand, American exchanges beat the snot out of Canada when it comes to business listings... however if we are interested in those types of stock we have easy access to them.

OK...... WHAT MISTAKE DID I MAKE YEARS AGO WHEN INVESTING IN AMERICAN STOCKS ?

In Canada, a stock with a share price value in the $1.00 - $5.00 is not considered a penny stock by most. We usually reserve that term for sub-$1.00 stocks. Most Mining/O&G startups start in the sub-$1 range... by the time they breach the $1 level, they become Juniors and can be judged by their quarterly financial reporting and if you are a good judge of stocks you can often find nuggets of gold in companies in this range.... Once they are over $5.00 they are on their way for becoming a mature company.

Therefore, a good hunting ground for suitable stocks lies in the $1 - $20 / share

In American stocks, they consider a $5 an penny stock and hence serious investors don't seem to bother with these stocks. You see that most of the action is in more expensive stocks in the $10 - $100/share.

So I made the mistake of trying investments in the $1 - $10 American stocks and was disappointed in the quality of stocks I found there and literally paid the price for that lesson.

I am probably going to have to rethink my number of shares / purchase in this fantasy American portfolio. I will concentrate on stocks in the $15-$30 range...I suppose.

UE
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