Some shocking stats on the state of the TSX

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While doing some research for a colleague's story on MacDonald Dettwiler's big new acquisition, I stumbled across some staggering statistics on the status of technology in Canada.

Of the 300 companies in the S&P/TSX Composite Index, the combined value of the country's biggest tech names account for just 1 per cent of the market. One per cent.

Now contrast that with two data points. First, consider that energy names make up about 25 per cent of the index, and mining and materials companies account for another 20 per cent.

Then remember the prominence that the tech sector had back in 2000. In the summer of that year, the entire situation was reversed. Tech names accounted for 40 per cent of the the TSX, while mining was just 4 per cent and oil and gas was about 7 per cent.

Now, the numbers here are a bit skewed. Within tech, Nortel comprised 34 per of the entire index. If you look at the sector's weighting just two years later after the tech bubble burst, it comprised only about 4.5 per cent because Research in Motion was still a small company.

But this really isn't about tech specifically. It's about the broader index. With resource names accounting for so much of our index -- which has long been known -- you have to wonder if investors really understand what they're getting when they buy an index ETF.

With the weightings the way they are, is Canada's biggest index simply just a proxy for China?

And does that hurt other Canadian publicly traded companies? If China's economy continues to soften, less people are likely to buy the index, which means that all the non-resource names will also get less support.

There isn't much that can be done about this, but it's interesting to note nonetheless, given that a senior banker recently told me he barely watches the TSX any more because it doesn't really represent the broad economy.