Celebrating the No. 10 on Our 4-year Anniversary
Building the Foundation
Four years ago this month, we completed the roll out of our first stock exchange offering – a trading platform aimed at providing a better quality of execution for investors. Today, we consistently represent 10% of all volume traded in Canada.
With market penetration of our trading platform gradually growing, we began the rollout of our listings business. In March 2016 we listed our first security – an Invesco ETF. We then proceeded to build out a substantial franchise of NEO-listed ETFs. After two years, we now list 10% of all Canadian ETFs.
This momentum in our ETF listing business was followed by firsts in corporate listings. In December 2017, we facilitated the IPO of Cannabis Strategies Acquisition Corp. It was a special purpose acquisition corporation which resulted in AYR Strategies, a $1B company that launched on NEO last month. This week, we launched our 10th corporate listing – Jushi Holdings Inc. Collectively, the market capitalization of NEO listed securities is now north of $6B.
Why have we been able to achieve these significant milestones? Because we are a progressive and senior stock exchange. With an steadfast focus on fostering investor confidence; providing investor education; facilitating liquidity; and, most importantly, valuing our clients by making sure we are hassle-free and easy to work with – all while remaining true to the principles that define us.
Beyond our core stock exchange offerings, we also built NEO Connect – a fund distribution platform. We launched this “first and still only” platform in May 2016 and today it has enabled the raising of close to $1B in assets through prospectus and OM funds. Again, we achieved this success by offering an exceptional investor experience and providing a lower cost solution for fund manufacturers.
Ready to take it further
We now have a solid foundation with substantial growth opportunity across all our business lines, and the strength and recognition to ensure that growth continues.
This foundation also allows us to continue to innovate and develop new products and new service offerings. For example, the announcement we made about building a solution to give the MFDA dealer community access to NEO Connect. The effective launch of this solution will be announced shortly and you can expect more innovation and more announcements in the months and years to come.
Finally, this foundation allows us to continue to be an advocate for change when we cannot directly enable it through our innovation and competition.
There are a number of critical issues and concerns that we cannot address on our own – they require regulatory intervention. These concerns put a dark cloud over the Canadian capital markets and, if not addressed, will harm us all.
- Segmentation of Canadian retail flow is a concern. Segmentation has reached a new level, driven by the recent changes by the TSX Alpha Exchange. Wholesale market-making has become a reality in Canada and, unlike the US, our market simply does not have the depth and resilience to absorb it.
- The lack of retail investor access to real-time, consolidated market data for TSX and TSXV-listed securities is an issue. It is harmful for investors because it prevents them from making fully informed invested decisions. It is harmful for public companies and ETF manufacturers as their trading activity is not properly represented to the marketplace. And it continues to put our Canadian markets at risk of coming to a grinding halt, just as it did when with the TMX outage last year.
- Anti-competitive behaviour around Indices in Canada is a concern. The TMX has imposed restrictions that exclude companies not listed on the TSX from being constituents of the S&P/TSX Indices. This prevents, for the obvious reasons, public companies from choosing the listing venue that is the right fit for them and their shareholders.
Our continued Commitment
As we grow, innovate, compete and make our and the industry’s voices heard about what matters, we will not waver from the core values that drive us: doing what is right for investors, capital-raising companies and their dealers, in support of a thriving Canadian capital markets and ultimately economy. This drive is what differentiates us from our competition, this drive is what will make our capital markets a better place.
President & CEO, NEO Exchange