TMX Select Launched

On Monday, the TMX Group launched its ATS, TMX Select. The ATS accepts day orders only, opens at 8 a.m. ET and closes at 5 p.m. ET. For stocks over $1, it charges the active side 0.02 of a cent, which on the TMX would cost from 0.33 of a cent to 0.35 of a cent, depending on volume. For the passive side, Select charges 0.02 of a cent, while the TMX rebates the passive side from 0.31 of a cent to 0.32 of a cent. For stocks under $1, Select charges the active side 0.01 of a cent, which on the TMX would cost 0.02 of a cent. For the passive side, Select charges 0.01 of a cent, while the TMX rebates the passive side 0.01 of a cent.

Select has enabled eight symbols for trading so far, six of which are over $1, such as Bombardier Inc.'s Class B shares and Rona Inc., while two companies are under $1, Passport Potash Inc. and U.S. Silver Corp. Next Monday the ATS will add another four stocks, Manulife Financial Corp., Potash Corp of Saskatchewan Inc., Research in Motion Ltd. and Royal Bank of Canada. It then plans to phase in more symbols later, and will let investors know one week in advance. According to Catherine Kee, TMX Group's corporate communications manager, the ATS has no particular method for picking the companies; it just "chooses a variety of symbols with different liquidity levels, as well as some from TSX and TSX-V."

Select has not yet released its first two days of trading stats. Ms. Kee says, "It's premature and not relevant until the full rollout occurs in a few weeks." One of the TMX's vendors said it has not yet received any trades for TMX Select, but said it might mean the ATS has not yet been incorporated into the exchange's feed.

Meanwhile, Alpha's Jos Schmitt continues to talk up the volume on the new Alpha IntraSpread. He says it traded 4.74 million shares on July 11, up from a mere 90,000 shares on June 22.

Also this week, Bank of England's director of financial stability, Andrew Haldane, is in Beijing, proposing a high frequency trading "speed limit" at the International Economic Association World Congress. He says a speed limit, or a minimum resting time, on trades would make high frequency trading less desirable. High frequency traders depend on quick turnover (measured in millionths of a second) to take advantage of small price differences. Mr. Haldane says that a speed limit would also stall the HFT technology race to create the fastest algorithm, which the media has been calling the "race to zero." The financial stability director says, "Grit in the wheels, like grit on the roads, could help forestall the next crash."

by Stockwatch Business Reporter