BET YOUR ASSAY - Mining Terms Explained Message Board

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Gold/Mining/Energy : BET YOUR ASSAY - Mining Terms Explained

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To: James R. who wrote (346)	3/3/1998 7:29:00 PM
From: Ray Hughes	Read Replies (1) of 463

There are three benefits a company derives from being newly TSE 300 listed: 1. Index Funds MUST buy the appropriate weighting of the newly listed company and sell the companies dropped from 300 Index. So, getting bought beats getting sold. 2. TSE 300 implies growth. 300 stocks are the 300 largest Canadian companies ranked according to market capitalization. Getting on the 300 spotlights a company as a growth vehicle. 3. TSE 300 listing implies quality because this is Canada's premier listing. This may be a false notion, however, because there are no new "quality criteria" that a company must meet. Market cap may suddenly rise dramatically owing to totally external events. This was true recently for a metal producer as the price of its primary product shot up. Same small company as before but its share price rose 50% putting it on the TSE 300. Subsequently the metal price dropped, the company's market cap fell back and it would not have continued to qualify for 300 Index. Luckily, however, the metal price soared again ...! hope this helps Ray Hughes

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