May 16, 2024
Equities Notice 2024-012

TMX Group

TMX Equity Trading Notice

Minimum Price Improvement Peg - RFC Notice

TMX Equities Trading is pleased to announce proposed amendments to the Minimum Price Improvement Peg ("MPIP") for each of Toronto Stock Exchange ("TSX"), TSX Alpha Exchange ("Alpha"), and TSX Venture Exchange ("TSXV").

A Minimum Price Improvement Peg functions as a primary peg, but with a one-tick aggressive offset. Currently, where the spread is two ticks or less, the MPIP order rests as a dark order at the same-side NBBO instead of resting at the mid-point. As a result, MPIP order types will never rest at the mid-point of the Protected NBBO.

The proposed amendments will modify the current functionality of MPIP so that when the spread (protected NBBO) is two ticks or less, the MPIP order would rest at the midpoint instead of its existing behavior of resting on the same side as the NBBO.

The proposed amendments aim to enhance the flexibility and applicability of the MPIP order type, ensuring it effectively serves its purpose across a broader range of trading scenarios without compromising the intent of providing minimum price improvement.

Each of the exchanges has filed an application with the applicable securities commission relating to the proposed amendments, and a Notice of Proposed Amendments and Request for Comments for TSX and Alpha, and TSXV has been published here. Participants are encouraged to provide their views and feedback on the proposed amendments. The public comment period ends on June 17, 2024.

The proposed amendments are expected to be implemented in Q3 2024, subject to regulatory approval.

For more information regarding this notice, please contact the Account Management Team.