The Toronto Stock Exchange (TSX) announced on Monday that it has begun the testing phase for its forthcoming mutual fund trading platform, TSX NAVex, and that investment dealers can now connect to the platform in a test environment.
When the new platform launches in June, the TSX expects it to create efficiencies for investment dealers and financial advisors by enabling them to execute mutual fund transactions through exchange’s trading, clearing and settlement facilities.
Firms will be able to connect to the platform through their existing connections to the TSX, and mutual fund transactions will still be carried out with the fund companies directly at end-of-day net asset value (NAV) prices. Trades will be settled through CDS Clearing and Depository Services Inc.
The new platform aims to facilitate bulk trading through existing order management platforms, making it easier for dealers to include mutual funds in discretionary, fee-based programs that currently utilize equities and exchange-traded funds. The exchange is promising streamlined processing and reduced operational risk for dealers while platform trading may help for fund companies expand distribution.
Earlier this year, TSX rival Aequitas Innovations Inc., launched its own mutual fund trading platform, Aequitas Connect, that it developed with fund giant, Invesco Canada Ltd., which also trades and settles mutual funds much like equities and exchange-traded funds.
TMX to launch trading platform for mutual funds
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