Named AlphaX US, the ATS is TMX Group’s first venue expansion outside of Canada for its markets division.

The ATS will trade US-listed securities only (Reg NMS), with TMX Group adding that participants will be FINRA-registered broker dealers.

“After continuous consultation with our clients, we are proud to introduce AlphaX US, a venue that is focused on execution performance, and provides innovation and ease to the broker dealer community,” said Heidi Fischer, president, TSX Alpha US.

“There are several unique offerings within AlphaX US, and we have combined that functionality with a model that provides easy implementation, customisation, and strong analytics for our partners. It’s through feedback and collaboration with our stakeholders that we are able to deliver solutions that make markets better.” 

AlphaX US provides trading in all Regulation NMS common stock, exchange-traded funds and American depository receipts.

The venue follows the US equity market holiday calendar and matches trades during regular US market hours.

TMX Group added that AlphaX US allows order entry starting 60 minutes prior to the open and continuing throughout the trading day. 

“One of our top priorities is solving for the business needs of our clients,” said Luc Fortin, global head of trading at TMX Group.

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Following the strategic investments TMX Group made in VettaFi is H1 2023 for 22% of the common units, the total amount to be paid for full ownership totals $1.03 billion.

“The acquisition of VettaFi will add a dynamic new component to our growing information business, with an exciting set of capabilities and a visionary, innovative team committed to client success,” said John McKenzie, chief executive of TMX Group.

“Moving forward, the addition of VettaFi increases the depth and value of data-driven insights we provide to clients, expands our digital expertise and enriches our industry-leading support for ETF issuers. From a strategic standpoint, this acquisition accelerates TMX’s long-term global expansion, and increases the proportion of revenue derived from our Global Solutions, Insights and Analytics division, and from recurring sources.”  

VettaFi provides a suite of global indices through its index factory, ETF services including ETF trends and analytics, a global ETF database, and digital distribution.

It also offers asset managers a range of indexing and digital distribution solutions to scale their businesses.

“Early on in our relationship with TMX Group it became clear that not only did we have complementary products and solutions, but our companies also have complementary cultures rooted in like-minded values and ambitious vision,” said Leland Clemons, chief executive of VettaFi. “Together, we will make markets and each other better.” 

VettaFi will be included in TMX’s Global Solutions, Insights and  Analytics segment, with the transaction expected to be completed in January 2024, subject to customary closing conditions.

This acquisition and inclusion into TMX’s Global Solutions, Insights and Analytics segment follows the launch of a new platform by TMX Group in November, designed to optimise the trading of Canadian equities.

Comprised of two order books – Alpha-X and Alpha DRK – the new order types were designed to optimise trading execution by “dynamically adjusting” to market conditions, alongside enhancing natural order flow and limiting adverse selection that occurs in the market due to “natural speed advantages” in the trading ecosystem.

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Comprised of two order books – Alpha-X and Alpha DRK – the new platform is aimed at enhancing natural order flow and limiting adverse selection that occurs in the market due to “natural speed advantages” in the trading ecosystem.

Alpha-X is the new platform’s visible order book and contains all the order types found on the TSX Alpha Exchange, alongside a new order type, Smart Limit. The Alpha DRK is the platform’s new dark book and consists of pegged market and limit order types, alongside a new order type, Smart Peg.

TMX Group confirmed the new order types were designed to optimise trading execution by “dynamically adjusting” to market conditions.

“TMX is committed to exploring new ways to meet the needs of clients across our diverse trading ecosystem, and to providing adaptive, responsive solutions to their competitive challenges here in Canada, and around the world,” said Rizwan Awan, president of equity trading and head of TMX markets, products and services.

“Alpha-X and Alpha DRK are designed to enable all participants, including institutional clients, to optimise trading strategies and improve their execution quality in fast-moving, modern markets. We are grateful for the feedback and continued partnership of stakeholders in our marketplace, as we work to make our markets better today and into the future.”

Several venue operators and vendors have bolstered their offerings in the Canadian equities space in the last few years.

In 2021, Cboe created a new block trading platform in the region. The new platform, Cboe LIS powered BIDS in Canada, combined MATCHNow and BIDS to create a market center for block-sized liquidity for buy-side and sell-side participants.

This was followed by Instinet, which launched a new BlockCross solution in Canada after rolling out the mechanism in EMEA. The service allows traders to route conditional, block-size orders to Instinet’s Canadian alternative trading system (ATS), Instinet Canada Cross.

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TMX Datalinx, the information services division of TMX Group today unveiled its Environmental, Social and Governance (ESG) data hub.

Through this initiative, which includes involvement from leading ESG data and analytics providers, ESG considerations will be integrated into the investment decision-making processes of TMX’s clients.

Speaking to The TRADE, Michelle Tran, president of TMX Datalinx, said: “Our goals have always been client focused and ESG is one of those things which is coming up more and more when we discuss data with our clients.

“In today’s environment we see ESG market data as important to investors and traders, especially looking at how their investment decisions get made and how they use the information given that there’s lots of complexity in ESG data in terms of quality and different types of metrics.”

The hub will deliver data to clients and include: climate action plans, impact quantifying, company and controversy screening, news and event coverage, corporate peer analysis.

Discussing the data sources themselves and TMX Datalink’s approach, Tran told The TRADE: “We really looked at specialised providers and we treat it like a portfolio and ask ourselves, okay so where’s the gap? We very carefully select our ESG content providers and partners – it’s not a marketplace. We don’t say come one come all.”

“[…] We’re doing the hard work of sort of curating so I think keeping track of the partners that we bring on and their constructive feedback will be a win for both sides.”

Confirmed data providers for TMX ESG are: OWL ESG, MT Newswires, GIST Impact, Inrate, Wall Street Horizon.

Read more – The TRADE predictions series 2023: ESG

TMX Datalinx serves customers globally with a broad range of both real-time and historical data products. 

Speaking to The TRADE about the future focus for TMX Datalink in this vein, Tran highlighted plans to continue to involve clients in the strategy: “I think when we launch our hub, we’ll probably be calling for our clients to say let’s create a committee of ESG data experts to ask how and where we can help our clients solve problems […] we want to use this opportunity of launching the hub to have those deeper conversations with our clients to see if this set resonates and using that as a direction for our expansion and longer term road map.

“I think if we take this further down the line, down the value chain, what we hope is to be able to not only expand the coverage, but we also expand the partnerships to actually create and drive other products off of this.”

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The study was commissioned by Montréal Exchange Inc (MX), the derivatives arm of TMX Group, and surveyed over 100 senior executives from proprietary trading firms, hedge funds, asset managers and the sell-side about demand and trends in trading in extended hours sessions.

The trend is, unsurprisingly, being driven by firms already trading in extended sessions on international exchanges, with 96% of respondents reporting some or significant interest in trading during extended hours trading sessions.

The remaining 4%, which reported no demand, were international banks with global desks that traded during local hours.

However, even firms that are not currently trading in extended hours sessions are increasingly thinking about doing so, with over half (54%) reporting demand.

Overall, the study found that demand is strongest in Asia, where 44% of respondents already trade extended hours and a quarter (26%) of those that don’t are keen to look into it. The highest demand for extended hours was reported by asset managers and hedge funds, which Acuiti believes represents the increasing global reach of this market segment.

“As we continue to push the evolution of our markets and address the increasing global demand for Canadian derivatives, launching extended hours in Asia was the next phase of MX’s globalization strategy,” explained Luc Fortin, president and chief executive of MX and global head of trading at TMX Group.

“As we move forward, extended trading hours better aligns MX with our global peers, increases international visibility and connects us to more clients.”

However, the reasons for wanting extended trading hours can vary, found Acuiti, with asset managers wanting the ability to better hedge exposures, while hedge funds and proprietary trading firms are more interested in optimising their strategies.

For firms already trading extended hours, key drivers of demand include capturing specific opportunities, requirements for trading strategies, the ability to react to events throughout the day and hedging considerations.

For firms that are not yet trading extended hours, the strongest priority is to capture specific opportunities related to extended trading hours.

“The world is becoming smaller in terms of firms’ ability to trade globally and the launch of extended hours trading sessions is a key development in facilitating that trend,” said Will Mitting, founder and managing director at Acuiti.

“The appetite from firms based in Asia to increase the scope of their trading activities is striking and reflects the ever-increasing sophistication and ambition of firms across the continent.”

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