Aequitas, TMX rivalry set to heat up over fund trading platforms -sources

Wed Nov 4, 2015 6:17pm EST
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article | Single Page
[-] Text [+]

By Euan Rocha

TORONTO Nov 4 (Reuters) - The rivalry between Canada's TMX Group Ltd and smaller rival Aequitas Innovations Inc is set to intensify as the two exchange operators race to create platforms for the buying and selling of some actively managed funds.

Two sources with knowledge of the plans, who asked not to be named as details are not yet public, said Aequitas is aiming to launch a platform that will be operational in the first quarter of 2016.

Aequitas, owned by Canadian financial players including Royal Bank of Canada and some pension and mutual fund managers, declined to comment.

With trading fees in existing markets like stocks getting squeezed, exchange operators have been looking to launch new products to boost revenue.

At the same time, the investment industry is under pressure from regulators to be more transparent on fees, forcing fund companies to make their products more competitive.

In October, Invesco Canada launched what it calls platform-traded funds (PTFs), an actively managed investment vehicle with lower fees than traditional mutual funds. The instruments however, can currently only be traded within the Invesco dealer network.

One of the sources said Aequitas is working with Invesco and other partners to create a platform that would facilitate the trading of such instruments across a much wider dealer network.

Aysha Mawani, head of corporate affairs for Invesco Canada, said the fund manager was working with a third party to help bring its PTFs to the wider market, but declined to name the party.   Continued...