Neo renews call for fair market data access

Securities regulators have been urged to ensure a more complete picture of trading activity for investors

Neo renews call for fair market data access
The company in charge of one of Canada’s newer stock exchanges has asked provincial securities regulators to make sure that investors can access real-time consolidated market data.

Aequitas Neo Exchange has submitted a filing to the Canadian Securities Administrators contending that most retail investors and their advisors do not have a complete view of the trading activity of stocks listed on the TSX and the TSX Venture Exchange (TSX-V), according to the Globe and Mail.

While most retail brokerage accounts display price and volume trading data about stocks on the TSX and the TSX-V, stocks and ETFs can also trade on a dozen other exchanges in Canada, such as those run by Nasdaq and Aequitas.

Trading platforms offer access to data from other markets, but that involves an additional fee, which Aequitas said turns off most retail investors. “People don’t have access — and don’t even know that they don’t have access — to all the data about what’s happening in the markets,” Aequitas CEO Jos Scmitt told the Globe and Mail. “Now, it’s time for the regulators to step up to the plate.”

While regulators require markets to make all trading-activity data available to investors and approve any fee structures for market data access — which market participants have criticized for being too dear — dealers are free to decide how to distribute the market data to clients.

“This is a daily frustration for us,” said Som Seif, CEO at Toronto-based ETF dealer firm Purpose Investments. “If a product of ours trades 50,000 shares but most of our clients see 5,000 shares, they think there’s no success there or it’s not trading well. But it’s not just us. It’s every ETF or company’s stock.”

Aequitas has previously addressed the Competition Bureau with concerns that TMX Group, which runs the TSX and TSX-V, restricted competition by effectively blocking access to market data. In a ruling last year, the Competition Bureau declared that TMX’s actions did not amount to anti-competitive behaviour.

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TMX Group did not violate Competition Act, investigation concludes