Information Related to Trading on Multiple Canadian Equity Marketplaces
With the emergence of multiple equity marketplaces in Canada, MF Global Canada Co. (“MFC”), wishes to advise its clients of some conditions that could affect them in this new trading environment.
Hours of Operation for Trading in Listed Canadian Securities
MFC trading staff will be available for order execution between the hours of 9:30 a.m. and 4:00 p.m., Eastern Standard Time ("EST"), Monday through Friday, not including statutory Canadian holidays. Staff may be further available before and after these hours however, MFC will not guarantee any order taking and/or trade execution outside of the hours noted above.
Disclosure of Marketplace
An order executed using one or more marketplaces or alternative marketplaces in either Canada or the United States will be reported to the client using a trade confirmation that will include the following: "we confirm the following purchase/sale for your account traded on a North American Marketplace, details available upon request". Should you receive such a confirmation, please contact your Investment Advisor or any member of MFC’s Compliance department, and MFC will ensure full details are provided for all your trades.
Principal Marketplace
For those securities listed on the Toronto Stock Exchange ("TSX") and trading on various other alternative marketplaces, the principal marketplace will be the TSX unless notified otherwise by MFC. Please be advised that unless otherwise agreed to between an Investment Advisor of MFC and the client:
a. an order received prior to 9:30 a.m. will book to the pre-opening of the principal marketplace (currently the TSX) for execution on the opening; and
b. an order received after 4:00 p.m. will be entered the next business day to the pre-opening of the principal marketplace (currently the TSX).
Handling of different order types in a Multiple Marketplace Environment:
Day Orders
A Day Order is an order that is only valid on and for the day it is entered. Day Orders will only be valid between the hours of 9:30 a.m. and 4:00 p.m. EST. A Day Order received prior to the opening of the principal marketplace at 9:30 a.m. EST (currently the TSX) will not route to an alternative marketplace. Instead the order will route into the opening sequence of the principal marketplace. A Day Order received after the opening of the principal marketplace will be entered into the "best market" at the time of entry. "Best market" is defined as the market with the best bid (buy price) or offer (sell price) and/or best historical liquidity and where MFC believes the order has the highest probability of execution. From there, the order will trade on any marketplace MFC has access to and/or can access for the purpose of best execution. If the order is not filled in full, it will expire at 4:00 pm on the market where the last portion of the order remains live (unless otherwise agreed between the client and the Investment Advisor of MFC).
Market Orders
A Market Order ("MO") is when the client instructs a dealer to buy or sell at whatever prices available are in the marketplace to help ensure a complete and full fill. These orders require immediate completion. A market order received prior to the opening of the principal marketplace at 9:30 a.m. (currently the "TSX") will not book to an alternative marketplace. Instead, it will book into the opening sequence of the principal marketplace. If received after the opening of the principal marketplace, the order will be entered into the "best market" at the time of entry. "Best market" is defined as the market with the best bid (buy price) or offer (sell price) and/or best historical liquidity and where MFC believes the order has the highest probability of being executed. From there, the order will trade on any marketplace MFC has access to and/or can access for the purpose of best execution. The order will expire, if not filled in full, on the market where the last portion of the order remains live until that marketplace closes. In the case of an order where the last portion remains on the TSX, this will expire at 4:00 p.m. EST.
Limit Orders ("LO")
A limit order has a specific minimum sale price or maximum purchase price provided by the client. A limit order received prior to the opening of the principal marketplace at 9:30 a.m. (currently the "TSX") will not book to an alternative marketplace. Instead, it will book into the opening sequence of the principal marketplace. On or after 9:30 a.m., if a limit order is not immediately executable on any marketplace, the client may designate their marketplace of choice for booking of the unexecutable order. If the client does not direct the unexecutable order to a specific marketplace, the order will be entered into the "best market" at the time of entry. "Best market" is defined as the market with the best bid (buy price) or offer (sell price) and/or best historical liquidity and where MFC believes the order has the highest probability of being executed. From there, the order will trade on any marketplace MFC has access to and/or can access for the purpose of best execution. The order will expire, if not filled in full, on the market where the last portion of the order remains live until that marketplace closes. For an order where the last portion remains on the TSX, this will expire at 4:00 p.m. EST.
Special Terms Orders
Special Terms Orders ("STO") are orders with specific terms that are not executable in the regular marketplace. STO orders will only post to the Special Terms Market of the principal marketplace (currently the TSX) unless they are immediately executable on an alternative marketplace at the time of entry and they will only be live between 9:30 a.m. and 4:00 p.m., at which time they expire.
Good Till Cancelled Orders
Good Till Cancelled Orders ("GTC") are orders that the client wants to remain open until a specified date of expiry. These orders will be entered on the principal marketplace (currently the TSX) if they are not immediately executable on an alternative marketplace at the time of entry (on or after 9:30 a.m. EST). The order will remain in the principal marketplace until executed or expiry, whichever comes first. MFC policy will only allow the entry of orders with a 60-calendar-day maximum good-till-cancel date. It is the client’s responsibility to ensure they know what the date of expiry will be and to contact their Investment Advisor on the expiry date should they wish the order to be re-instated.
All or Nothing Orders
- Retail All or Nothing Orders ("AON") are orders that must immediately be executed in full; no partial fills are to be executed or booked pending a complete fill. An AON order received prior to the opening of the principal marketplace at 9:30 a.m. EST (currently the TSX) will not book to an alternative marketplace. Instead, the order will book into the opening sequence of the principal marketplace (currently the TSX). If the order cannot be filled according to the AON terms on the TSX and there is sufficient combined volume on alternative marketplaces, it will be booked to the multiple market places for execution in full.
- Institutional AON orders are orders that must be executed for large block volume in full. These orders will not book to a marketplace unless they can be filled in full for their entire volume at the time of receipt. These can be executed on any marketplace as agreed to between the client and investment advisor.
Stop Orders
Stop orders are intended to limit the loss or protect a profit on an investment to a set price. A stop order received at anytime will not book to an alternative marketplace. Instead, the order will book into the principal marketplace (currently the TSX). On election of the stop on the principal marketplace, if the order cannot be executed in full at the stop price, the order will be booked as a market order to the marketplace with the "best market" at the time the stop is elected. "Best market" is defined as the market with the best bid (buy price) or offer (sell price) and/or best historical liquidity and where MFC believes the order has the highest probability of being executed. Please note that due to the nature of stop orders, fill prices can vary significantly from that of the client’s stop price. Should a client wish to limit this variance, they can discuss a stop limit order with their Investment Advisor however; the client runs the risk of no execution if the limit price is away from the market at the time.
Market on Close Orders
A Market on Close ("MOC") order must trade at the close, at the calculated closing price, of the principal marketplace. Currently the TSX is the only marketplace that offers a MOC facility. All MOC orders will therefore be entered into the TSX, as the principal marketplace. Please be advised that this is an anonymous price facility. Therefore the client will not know the price at which the trade will be executed until after execution has completed. Limit orders are allowed but may, by the nature of a limit order, negate execution. For further details of this facility, please contact your Investment Advisor.
