24 3.6 Self-Trade Prevention TMX offers four types of solutions to assist trading participants in managing accidental trades with themselves (wash trades) and are available on all TMX marketplaces (TSX, TSXV, TSX Alpha). 3.6.1 Self-Trade Prevention Self-trade prevention is an optional order feature that prevents two orders from the same broker from executing against each other based on unique trading keys defined by the broker. These features provide more opportunities for individuals to participate on both sides of the market without unintentionally violating ‘wash trading’ rules described in UMIR 2.2. Rules permit individuals to place buy and sell orders on a market for a given stock at the same price so long as that individual only trades with others and does not cross his own orders. Preventing selftrading ensures there is no misleading appearance of additional trading in a stock. Cancel Newest Self-Trade Prevention An optional feature that prevents two orders from the same broker from executing against each other based on unique trading keys defined by the broker. An active order is rejected instead of trading against a resting order from the same broker with the same unique trading key. Mixed lot and odd lot volumes are allowed but the selftrade prevention is applied only to the board lot portion of the order. Cancel Oldest Self-Trade Prevention The Cancel Oldest self-trade prevention instruction prevents an incoming order from executing against a passive order from the same broker with a self-trade prevention instruction and matching self-trade keys. The passive order is cancelled and the active order trades up or down to its limit, booking any remaining volume if eligible. Please note that the cancel oldest self-trade prevention feature is not permitted with the long life order attribute. Mixed lot and odd lot volumes are allowed but the self-trade prevention is applied only to the board lot portion of the order. Decrement Largest and Cancel Smallest Self-Trade Prevention The Decrement Largest and Cancel Smallest self-trade prevention instruction prevents an incoming order from executing against a passive order from the same broker with a self-trade prevention instruction and matching self-trade keys. If both orders are of equivalent size, both orders are cancelled. If orders are not equivalent in size, the smaller order is cancelled and the larger order is decremented by the size of the smaller order. If the larger order is passive, its remaining volume continues to rest in the book; if the larger order is active, the balance of the order trades up or down to its limit, booking any remaining volume if eligible. Please note that the decrement largest and cancel smallest self-trade prevention feature is not permitted with the long life order attribute, or with mixed lot or odd lot volumes. Additional Details Self-trade prevention is applied during Continuous Trading session only, and keys are ignored during Market on Open allocation and Market on Close. Keys may be alpha-numeric (any combination of letters and numbers). It does not impact a broker if another broker uses the same key. If two orders from the same broker with the same key are matched, but both orders have different self-trade prevention instructions, then the instruction on the active order is used. Example Scenario with Cancel Newest Self-Trade Prevention When a tradable order is received, the TMX performs a check: If the same PO is on both sides of the trade, and the unique trading keys match, then the active order is killed immediately.
RkJQdWJsaXNoZXIy MjgzMzQ=