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What is CanDeal?

CanDeal is Canada’s largest electronic fixed-income trading system. CanDeal’s current shareholders include the six bank-owned investment dealers, a Toronto-based software company called Basis100 Inc. and data service MoneyLine Telerate.

The Toronto Stock Exchange announced on July 9 that it would be purchasing a 40% interest in CanDeal, as a way to expand beyond its historic base as the market for Canada’s largest companies. In return for this investment, CanDeal will give the TSX responsibility for its trading and data distribution systems. This new alliance is expected to shorten the time to process trading orders. Other stock exchanges have already established bond-trading services. The New York Stock Exchange lists and trades bonds, as do many European exchanges. This initiative gives the TSX access to an even larger base since the value of the bond trading market in Canada is six times larger than stock markets ($16 billion a day verses the TSX average of $3 billion) and it will also provide a new market for TSX’s computer services. Currently CanDeal offers institutional investors access to bond prices and yields from the six bank-owned dealers, which represent more than 80% of domestic bond traffic. For a monthly fee of $300, the institutional investor can access, place a buy or sell order. Institutions used to have to ask each dealer individually for this information. Only federal bonds are currently sold on the CanDeal network but future improvements that are to be funded by the TSX, will enable CanDeal to provide data on provincial bonds, corporate debt and commercial paper.