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Things that go BOOM! August 9, 2008

Posted by DustinRJay in Calgary real estate, stock market.
Tags: , ,
8 comments

The S&P/TSX Capped Energy Index is formed primarily of companies that have headquarters in Calgary.  Since 2001, the index has quadrupled creating wealth on a massive scale.  The boom in commodity prices has resulted in energy companies making more money, spending more money and allowing vested shareholders to cash out.

Excess liquidity brought about by the strong financial performance of Calgary energy companies was likely a major contributor to the Calgary house price boom.

The following graph shows that:

  • S&P/TSX Capped Energy Index outperformed Calgary real estate as an investment
  • Performance of the S&P/TSX Capped Energy Index was likely a leading indicator of the real estate boom

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