27 Section 4 Order Types TMX supports a variety of order types across its three marketplaces to offer choice while creating fair and orderly markets for all participants. 4.1 Change Former Order instructions (CFO) An order that is CFO’ed refers to an order instruction to cancel the former order’s version by replacing it with the new version. Such orders will retain relative priority in the continuous book only if the change is limited to a decrease in the displayed size of the order, an increase or decrease in the undisclosed portion of an iceberg or a change from sell long to (non-public) sell short or vice-versa or any change to other non-public markers that are incidental. Any other modification to an order, including an increase in the displayed size of the order, and/or price change, and/ or change from regular to iceberg order will result in such order losing time priority relative to other equally priced orders and the timestamp will be revised at the time of the modification. 4.2 Market Orders A market priced order is an instruction to trade the order at prices currently established by the opposite side of the market. Such orders have no trader defined limit on the potential trade price but these orders are subject to TMX bid/ ask price limits and TMX freeze price limits to prevent unintentional trade-to-trade price gaps which may otherwise occur if the opposite side of the market is thinner than the trader submitting the market order had expected. If there is not enough volume in the book to fill the order, the unfilled quantity of the Market order is booked at the Last Sale Price. Example: Market Orders Assume the CLOB is as follows: BID OFFER Order # Quantity Price Price Quantity Order # 001 100 10.00 10.02 400 003 002 100 9.99 10.02 100 004 If an incoming sell order #005 for 500 shares @ MKT is entered, then the following trades occur: BUYER ORDER # Seller Order # Quantity Price 001 005 100 10.00 002 005 100 9.99
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