NEX

What is NEX

NEX is a separate board on the TSX Venture stock exchange that gives a unique trading forum to listed companies that presently not meet the TSX Venture's continuous listing standards. The NEX is intended for companies that have low levels of business activity or have quit carrying on active business. It benefits such companies by providing their stocks with a degree of liquidity and giving visibility that might draw in likely acquirers or investors. These companies are distinguished by an "H" or "K" extension to their trading images.

Breaking Down NEX

NEX was sent off as a subset of the TSX Venture Exchange, a Canadian stock exchange settled in Calgary, Alberta. The TSX Venture Exchange is a public venture capital marketplace that allows investors to invest in small cap and emerging companies. The TSX Venture Exchange was formerly known as the Canadian Venture Exchange before it was acquired and renamed by the TSX Group in 2001. The TSX Group was renamed the TMX Group in no time a while later. Both the Canadian Venture Exchange and the TSX Venture Exchange zeroed in on companies that were too small to be listed on the Toronto Stock Exchange, which is additionally owned by the TMX Group.

Prior to the send off of NEX by the TSX Group, companies that couldn't meet the TSX Venture Exchange's continuous listing criteria were designated as "inactive" and given 18 months to either fulfill the listing guidelines or be delisted. The presentation of NEX let such companies free from the colossal pressure of a delisting cutoff time, and gave their management and shareholders one more opportunity to make something happen. Companies that don't meet the TSX Venture Exchange's listing requirements are normally moved to the NEX Board following 90 days. They can stay on the NEX board endlessly. Companies that have never been listed on TSX or TSX Venture Exchange can't be listed on NEX.

Benefits and Disadvantages of NEX

NEX has lower listing fees and simplified rules, compared to the TSX Venture Exchange.

The companies listed on the NEX board will generally have low levels of business activity compared to those on the TSX Venture Exchange. Companies on the NEX board remain publicly traded even as they reconsider their business strategy. In any case, a portion of these companies will be unable to do so effectively.

It is important to note that NEX companies must keep on gathering the equivalent disclosure standards applicable to all Canadian public companies, and must likewise keep up with great standing with the pertinent Canadian securities commissions.