Transition to shorter T+2 settlement now underway

The Investment Industry Regulatory Organization of Canada (IIROC) announced on Thursday that it’s bolstering market surveillance with a deal to implement an upgraded version of Nasdaq’s SMARTS market surveillance technology to help oversee all debt and equity trading in Canada.

IIROC already uses an earlier version of Nasdaq’s market surveillance technology. The new edition, which is expected to be fully implemented by the summer of 2018, is capable of monitoring up to a billion transactions daily, in real time, IIROC says.

The new system “will support cross-asset surveillance and investigations, as well as allow for quicker detection of trading anomalies across multiple products and dealer firms. It can also accommodate the addition of new asset classes as financial products and markets evolve,” the self-regulatory organization reports.

“These enhancements will enable IIROC to more effectively detect and respond to potential market abuses across debt and equity markets,” says Andrew Kriegler, president and CEO of IIROC, in a statement. “This system will also strengthen IIROC’s analytical capabilities so we can identify and respond to emerging market trends in an efficient manner.”

IIROC monitored more than 446 million trades across the five stock exchanges and eight alternative trading systems that are operational in Canada in fiscal 2016-17.

“By allowing us to be more agile and flexible, the system will provide a solid foundation for the evolution of IIROC’s market supervision in the years ahead and bring us one step closer to our vision of providing leading-edge market surveillance,” adds Victoria Pinnington, senior vice president, market regulation and policy, at IIROC, in a statement. “This state-of-the art system offers new tools and approaches including machine learning and artificial intelligence that our team will leverage to more efficiently monitor for abusive behaviour.”

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