TMX POV - Optimize your interactions when dark trading

TSX DRK, Canada's leading alternative dark pool for trading Toronto Stock Exchange (TSX) and TSX Venture Exchange (TSXV) listed securities, recently introduced an innovative solution called Contra Midpoint Only Plus (CMO+) designed to deliver a higher level of protection for participants looking for a true mid-point execution.

Through the CMO+ functionality, TSX DRK aims to increase the value we bring to participants and long-term investors, providing access to a large pool of dark liquidity and a fair fill.

Why CMO+? Amid the complexities of multi-market venues, pricing information can be calculated at a slower rate than some of its own market participants. This may result in a venue executing trades at a stale price, giving the "faster" trading participants' orders an advantage at the expense of orders relying on the venue for accurate pricing.

CMO+ attempts to guard against this scenario by adopting a short delay to level the playing field and help assure a true mid point. And, it's innovation such as CMO+ that is driving improvements across Equity Markets on a global scale.

Did you know?

• All CMO+ orders are delayed on entry by 400 to 600 milliseconds
• Orders are protected against being picked off opportunistically as quotes change
• Mid-point only with a focus on matching like minded long term investors

Dark Trading is evolving - Global exchanges may offer similar features with an eye on fairness but in Canada, CMO+ is an innovative offering. With global peers throughout Europe and the United States deploying comparable anti latency arbitrage mechanisms in an effort to improve execution, we met the needs of our clients with mid-point pricing protections offered through CMO+.

Today, TSX DRK provides a range of benefits for investors and it has gained traction in the Canadian marketplace:

• 98% TSX DRK volume received price improvements
• 90% TSX DRK volume executed at the midpoint or better
• 7.4 million average daily DRK volume
• 19% market share

As with our other TSX DRK offerings, CMO+ orders are able to reduce signaling and information leakage that can result in market impact through the use of Minimum Quantity (and Minimum Interaction Size conditions. Volume in CMO+ is growing as participants integrate dark pool offering into their workflows and multi-post algorithms.

I invite you to consider challenging the Canadian Dark status quo with an optimal price-improving dark strategy and the incorporation of CMO+.

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