This policy is issued pursuant to, and in compliance with, Investment Industry Regulatory Organization of Canada (“IIROC”) Rules 3119-3129 concerning best execution of client orders and National Instrument 23-101 Trading Rules (“NI 23-101”). In relation to order execution, MogoTrade Inc. (“MogoTrade” or “we”) is required to obtain the most advantageous execution terms reasonably available under the circumstances when executing client orders. MogoTrade is required to take into account a range of execution factors and determine their relative importance based on the characteristics of our clients, the orders that we receive and the markets in which we operate. As a non-executing IIROC Dealer Member, MogoTrade engages another Dealer Member to provide execution services on its behalf.
This policy applies to trading on behalf of clients of conducted on MogoTrade’s app-based OEO trading platform, and includes all securities traded on that platform.
Best Execution represents MogoTrade’s obligation to seek the most advantageous execution terms reasonably available under the circumstances when executing a transaction on your behalf. We will consider such execution factors as price, speed, likelihood of execution & settlement, and costs.
MogoTrade has entered into a routing agreement with Independent Trading Group Inc. (“ITG”), an IIROC Dealer Member. Pursuant to that routing agreement, MogoTrade is permitted to electronically transmit orders through ITG’s order management systems for automatic onward transmission to marketplaces and execution destinations. MogoTrade has reviewed ITG’s Best Execution Policy and has determined that it is a reasonable best execution policy, designed to comply with IIROC Rules relating to best execution and NI 23-101. ITG’s best execution policy incorporates trade-through protections for protected Marketplaces (the Order Protection Rule, or “OPR”) as prescribed by NI 23-101. As prescribed by OPR, ITG connects to all “protected” marketplaces, and in the interest of providing additional sources of liquidity and ensuring best execution, ITG connects to and considers quotes from all Canadian marketplaces (both protected and unprotected) when routing its client orders. ITG uses smart order routers that check for better prices on all marketplaces and alternate trading systems (“ATSs”), including dark liquidity sources, before executing an order.
Orders for Canadian-listed securities may be executed by ITG on the listing exchange, an ATS which trades the security, or on a foreign organized regulated market. Trade confirmations issued to MogoTrade will indicate whether some or all of an order executed on multiple marketplaces in Canada, the United States or both. Additional detail, such as the marketplace of execution for each underlying trade, is available to MogoTrade by ITG upon request.
Orders submitted after 5:00 p.m. EST prior to 8:30 a.m. EST will be queued and executed between 8:30 a.m. EST and to 5:00 p.m. EST.
The “Primary Marketplace” for all securities listed on the Toronto Stock Exchange, TSX Venture Exchange, Canadian Securities Exchange or Aequitas NEO Exchange, will be the exchange on which the security is listed, whether or not the security is trading on other alternate marketplaces.
MogoTrade may also route trades to other executing brokers, including National Bank Financial Inc. (whose Best Execution Policy can be found here) and CI Investment Services (whose Best Execution Policy can be found here). MogoTrade has determined that these best execution policies are likely to effectively achieve best execution for MogoTrade’s clients.
All orders will be routed to either the Primary Marketplace or alternative marketplaces as follows, unless MogoTrade provides ITG with specific instructions:
Market Orders are be executed upon entry to a marketplace at the best available ask or bid price.
Limit Orders will be executed at or better than a specified maximum or minimum price set by MogoTrade, as specified by MogoTrade’s client. If a limit order is not immediately executable, ITG will route this order to a marketplace. These orders will remain in the market until the order is filled, corrected, cancelled or expired.
Each of the Canadian marketplaces support a variety of order types and features. These include order types or designations required by the regulators, as well as types or designations which impact how an order may trade. A summary document which outlines the order types and features available on each trading venue is available to MogoTrade’s clients upon request.
MogoTrade will review its best execution policy and procedures at a minimum annually, and specifically whenever there is a material change to the trading environment or market structure that may impact MogoTrade’s ability to achieve best execution for its clients, such as the launch of a new market or a material change to the functionality of an existing market.
In the annual review, MogoTrade considers the following:
An annual review of ITG’s best execution policies and procedures relevant to MogoTrade is performed to ensure they continue to provide reasonable assurance of the best execution of MogoTrade client orders. A review may be called outside of the annual review if MogoTrade receives notice of any material changes to those policies and procedures or becomes aware of any material changes to the best execution rules governing the correspondent broker.
MogoTrade obtains an annual attestation from ITG that it has complied with and tested its policies and procedures on best execution in accordance with IIROC Rules 3119 through 3129. If MogoTrade identifies trade execution results that are inconsistent with ITG’s best execution disclosure, it will follow up with ITG and document the results of its inquiry.
Like all brokers, MogoTrade is incentivized to minimize its trading costs. Unlike many brokers, MogoTrade does not charge its clients commission to trade on the MogoTrade platform. ITG offers MogoTrade an attractive cost structure for trading through it. This may incentivize MogoTrade to prefer ITG over other executing brokers. To control this potential conflict, MogoTrade evaluates ITG’s execution against objective criteria on an annual basis in order to ensure that the execution it provides constitutes best execution as defined by applicable IIROC Rules.
