April 20, 2011 / 4:26 PM / 7 years ago

Toronto exchange's market share continues to slip

*TMX market share shrinks to 42 pct in volume terms

*Alpha has market share of nearly 20 pct

*Omega grows 3,000 pct since February 2010

By Solarina Ho

TORONTO, April 20 (Reuters) - The Toronto Stock Exchange continues to lose market share to smaller alternative trading systems, according to the latest statistics from the self-regulatory Investment Industry Regulatory Organization of Canada (IIROC).

IIROC figures show the TSX, which is owned by TMX Group (X.TO), had market share by value of just over 62 percent in the first quarter of 2011, down from just over 65 percent in the year-before quarter, and down from just under 64 percent in the final quarter of 2010.

By volume, the TSX’s market share shrank to less than 38 percent in the first quarter from more than 45 percent in the year-before quarter. It also fell from just over 40 percent in the last quarter of 2010.

TMX Group, which is seeking regulatory approval for a C$3 billion ($3.2 billion) agreement to be taken over by the London Stock Exchange (LSE.L), has seen its market share plunge since alternative trading venues began setting up shop in Canada several years ago.

Major stock exchanges around the world are in the midst of a consolidation frenzy as they try to remain competitive against ATSs. [ID:nN18253809] [ID:nLDE7301C4]

Alpha ATS, which began operations in November 2008 and is backed by the country’s biggest banks, is the leading alternative platform and now holds a market share of just under 20 percent in terms of value, volume and number of trades in the last quarter.

    Other Canadian trading marketplaces include Chi-X, CNSX’s Pure Trading and Omega ATS.

    Omega, which began operations in December 2007, said on Wednesday it has become the country’s fastest-growing ATS.

    Last month, it had C$4.42 billion in trades, up more than 3,000 percent from C$142.5 million in February 2010, when consulting and venture firm Tactico, which has offices in Toronto, Montreal and Los Angeles, took a 24 percent equity stake in Omega.

    It is still a small player in the Canadian market however. Last quarter, it accounted for roughly 1.5 percent of the value and volume traded in Canada, and 2 percent of the number of trades conducted.

    “I think all the ATSs in Canada are growing. We’re just growing more ... from a latency standpoint, we’re certainly the fastest ATS in the country,” said Mike Bignell, president of Omega.

    $1=$0.95 Canadian Editing by Peter Galloway

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