By James Langton
(November 28 – 18:15 ET) – Regulation Services at the Toronto Stock Exchange plans to distribute a monthly Closing Report effective December 1. The report will summarize tick-setting trades in the last hour of trading of each month for each brokerage firm.
Tick is trader slang for minimum spread. Depending on the stock price it could be a halfpenny, one penny or five cents.
The report, specific to each firm, includes a list of all issues in which the brokerage executed a tick-setting trade in the last hour. For each issue, the report will record:
- the direction of the final tick;
- the total number of tick-setting trades during the last hour;
- the number of tick-setting trades executed by the brokerage;
- the percentage involvement by the brokerage in the total tick-setting trades; and
- the details of the final tick-setting trade if it was executed by that broker.
TSE Regulation Services says it has created this report in response to several requests from brokerage houses. It says, “The reports merely summarize tick setting trades in the last hour of trading, and each report should not be considered a list of alerts or suspicious trades. Each brokerage will need to analyse its own trading to determine whether there is an indication of inappropriate activity.”
Since the RT Capital Management Inc. stock manipulation scandal earlier this year the TSE has become pre-occupied with each day’s closing market. A couple of weeks ago, it launched a proposal requiring brokers to report each Market-on-Close Order or end-of-day hedging activity in an effort to reduce volatility ahead of the close.