Following the Ontario Securities Commission approval of Alternative Trading Systems in Canada, there is the potential for different marketplaces to be trading the same security within Canada. Leede Jones Gable Inc. (“Leede”) will use all reasonable efforts to ensure that our clients receive “best execution” of their orders, whether they trade on a single or multiple marketplaces. This policy statement is intended to inform our clients of how their orders for securities traded on Canadian marketplaces will be handled and how these changes may affect them in this new trading environment.
1. Principal Marketplace
Unless otherwise notified by Leede, the principal marketplace for all securities listed on the Toronto Stock Exchange (“TSX”) will be the TSX, whether or not the security is trading on other alternate marketplaces.
The TSX currently has trading hours of 9:30 a.m. to 4:00 p.m. ET, Monday to Friday with the exception of statutory holidays. All references to time in this policy will be Eastern Time.
2. Hours of Operation for Trading in Listed Canadian Securities
Leede trading staff and order entry systems will be available for order execution during principal marketplace hours. Trading staff may be available at other times outside principal marketplace hours, however Leede cannot guarantee that clients will be able to place orders and have trades executed outside the hours of 9:30 a.m. to 4:00 p.m. ET.
3. Standard Routing of Orders
All orders for TSX securities will be routed as follows:
- an order received before the opening of the principal marketplace (9:30 a.m. ET) will be entered on the principal marketplace (TSX) for execution. Orders received prior to the market opening will not be routed to an alternative marketplace;
- an order received after the close of the principal marketplace (4:00 p.m. ET) will be entered to the pre-opening book of the principal marketplace for the following business day. Orders received after the market close will not route to an alternative marketplace;
- an order received during trading hours of the principal marketplace will be entered into the best market at the time of entry. The “best market” is the marketplace having the best bid (for sell orders) or ask (for buy orders) or where Leede feels the order has the highest probability of being executed. This may be any marketplace that Leede has access to or can access for the purpose of best execution;
- If the entire order cannot be immediately filled on an alternate marketplace, the portion of the order that remains unfilled will be entered on the principal marketplace, and the order will remain on the principal marketplace until the order is filled, expired, changed or canceled: and
- Any changes to an existing order will be handled in the same manner as a new order and will be subject to the routing outlined above.
If a client specifically requests that an order be routed to a specific market, the order will be entered into the specified market and will remain valid for the duration of the hours of operation of that market, regardless of whether the specified market is the best market. Leede will not assume any responsibility for routing the order to the best market if a client specifies a market for their order.
4. Order Execution
Certain types of orders have specific handling implications when multiple Canadian marketplaces exist:
- Day Orders: A day order is an order that expires if it is not filled on the day the order is entered on the marketplace. Day orders will be handled according to the “Standard Routing of Orders” outlined earlier in this document. Unexecuted day orders and partially executed day orders expire upon the close of the marketplace where the order is entered.
- Open or Good Til Canceled Orders: Open orders remain open until a specified expiry date, or until they are canceled. Open orders will be handled according to the “Standard Routing of Orders” (see item 3(d) above) and will be entered on the principal marketplace if the entire order cannot be executed immediately on an alternate marketplace. Open orders will remain with the principal marketplace until they are filled, canceled, changed or expired.
- Market Orders: Market orders are intended to be executed immediately at the best available price at the time the order is entered. Market orders will be handled according to the “Standard Routing of Orders” and will always be considered as day orders. Any remaining balance will expire upon the close of the marketplace where the unfilled portion of the order is entered.
- Limit Orders: Limit orders specify a minimum sale price or a maximum purchase price for execution of the order. Limit orders will be handled according to the “Standard Routing of Orders” and any unexecuted or partially executed limit orders will expire upon the close of the marketplace where the order is entered.
- Special Terms Orders: Special terms orders place restrictions on the execution of the order, such as “all or none”, “fill or kill”, specifying a minimum fill quantity or special settlement terms. Special terms orders will be entered into the special terms book of the principal marketplace unless they can be executed immediately on an alternate marketplace at a better price than the principal marketplace. Expiry of special terms orders will be as per a) or b) above, except in the case of “fill or kill” orders which will expire immediately following execution of any portion.
- Stop Loss Orders: Stop loss orders are orders that become market or limit orders when certain conditions are satisfied. Stop loss orders will only be entered to the principal marketplace, where they will remain until they are filled, canceled or expire.
5. Extenuating Circumstances
In the event of technical difficulties or other situations where Leede’s access to certain marketplaces or routing systems are unavailable, orders received will be directed to the principal or alternative marketplace as determined by the circumstances that exist in the marketplace at the time.
6. Disclosure of Marketplace
If an order is executed on more than one marketplace, there are 2 different ways a client may be notified of this: 1) the trades will be reported to the client using separate confirmations for each marketplace on which the order was executed. Each trade confirmation will identify the marketplace on which the portion of the order was executed. As a result, clients may receive more than one trade confirmation for an order. 2) The client will receive one confirmation slip with notification stating that the trade was executed on multiple marketplaces, details available on request.
Changes to this policy may be made from time to time at the sole discretion of Leede. Changes will be posted to Leede’s website www.leedejonesgable.com.
If you have any questions related to this policy, please contact your investment advisor.