Addition to the index
On April 12, Canopy Growth (WEED) (CGC) announced that it will be the first cannabis company to join the S&P/TSX 60 Index in what it called a “major accomplishment” for the company. Upon this news, the stock popped and was trading higher by 5.4% in the Canadian market under the ticker symbol “WEED” and up by 5.7% in the US market under the ticker symbol “CGC.” This may have also boosted the broader market sentiment towards the cannabis sector, as the ETF Horizons Marijuana Life Sciences ETF (HMMJ) was trading higher by 1.1% around 10:20 AM EST.
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Why this matters
The addition to the S&P/TSX 60 Index makes the company certainly more valuable than its peers including Tilray (TLRY), Aurora Cannabis (ACB), and Aphria (APHA). To be added to this index, companies are supposed to meet certain liquidity, domicile, and market capitalization requirements according to the company.
What other stocks are in the index?
Being a part of S&P/TSX 60 Index, Canopy Growth is on par with other Canadian giants such as Toronto-Dominion Bank, Royal Bank of Canada, Canadian National Railways, and Enbridge, just to name a few. The median market capitalization of these four companies stood at about 118 billion Canadian dollars on April 12, while Canopy Growth’s market capitalization stood at about 19.4 billion Canadian dollars.