Trading Volume Up in Canada

Terry Flanagan

The spike seen in volatility and trading volumes in the U.S in August made its way north of the border.

Canadian exchange operator TMX Group as well as small alternative trading systems such as Omega ATS benefited from the surge in volatility during August as much as their stateside counterparts.

“Canada in general as a marketplace is seen as a safe haven internationally,” said Mike Bignell, chief executive officer of Omega ATS. “We’re seeing more volumes as a result of the stability of our banking system and the general condition of Canada as financial entity. Everyone caught wind and came here.”

“There are volatile situations all over the world now,” Bignell added. “There is widespread market volatility, even in Canada. Although we’re not directly affected by the crises, everyone is intertwined.”

For August, TMX’s Montreal Exchange set a new record for average daily volume with 280,809 contracts, and overall volume for the month at 6.2 million. Volume was up 62 percent over August 2010, and was also up 23 percent compared to July.

The Toronto Stock Exchange was up 29 percent in trading volume compared to the previous year, to 9.3 billion shares from 7.2 billion. Total transactions were up 58 percent to 23 million.

Omega ATS experienced even larger gains year-over-year. Overall trading volume in August was up more than 400 percent to 415.4 million shares, up from 82.8 million last year and up 17 percent from 356.4 million shares in July. The number of transactions also jumped 444 percent from last year 161,300 to 877,253.

TMX runs several exchanges in Canada, including the Toronto Stock Exchange, TSX Venture Exchange, Montreal Exchange, as well as TMX Select, an ATS. It is currently the target of an unsolicited takeover offer from Maple Group, a consortium of Canadian financial firms and pension funds. It was previously in discussions for a merger with London Stock Exchange Group, before that deal was derailed due to a lack of shareholder support.

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