Montreal Exchange (MX)

What Is the Montreal Exchange (MX)?

The Montreal Exchange (MX) is a Canadian, completely electronic derivatives exchange. The MX at present records equity derivatives, currency options (options on the U.S. dollar), index derivatives, and interest rate derivatives (bond and money markets). It is Canada's most established exchange and Quebec's super financial derivative market.

Recently known as the Montreal Stock Exchange, the MX is part of TMX Group, which likewise incorporates the Toronto Stock Exchange (TSX) and the TSX Venture Exchange. TMX Group is situated in Toronto, with derivatives trading in Montreal.

The liquidity of the MX keeps on rising predominantly due to trading from various countries; there are in excess of 90 approved participants from London, New York, Chicago, and Montreal associated straightforwardly to the MX electronic trading system.

Understanding the Montreal Exchange (MX)

The Montreal Stock Exchange was established in 1874. In 1974, it merged with the Canadian Stock Exchange. After one year, it turned into the principal Canadian exchange to offer stock options.

In 1982, the Montreal Stock Exchange shortened its name to the Montreal Exchange. The name was changed to mirror the range of financial instruments (notwithstanding stocks) that were accessible at that point, including options and futures trading.

The Canadian securities market rearranged in 1999; the Montreal Exchange was renamed the Canadian Derivatives Exchange for the next decade, and the Toronto Stock Exchange turned into the place to trade the stocks of major companies. Another exchange, the Canadian Venture Exchange — presently called the TSX Venture Exchange (TSXV) — was made to work with the trading of shares of more modest companies.

The Montreal Exchange was acquired by the TSX Group on Dec. 10, 2007, yet the acquisition wasn't completed until May 2008. The total price for the merger was recorded as $1.31 billion CAD. The subsequent merger prompted another name for the group: TMX Group. This acquisition successfully combined Canada's equity and derivatives exchanges. Different countries, like Australia, have additionally combined stock and derivatives trading on a single exchange.

Today, the equity options trading on the MX covers the vast majority of the bigger Canada-traded companies, yet it isn't generally so broad as the U.S. options markets. The interest rate derivatives cover short-term broker's acknowledgments — going from the overnight rate to the three-month rate and two-and 10-year Canadian Government Bonds. The index futures and options cover the S&P Canada 60 index and several S&P/TSX sector indexes.

MX clearinghouse, the Canadian Derivatives Clearing Corporation (CDCC), gives all clearinghouse services to exchange participants. The CDCC deals with the exchange's risk openings while maintaining a top investment rating and a strong reputation. The CDCC additionally offers risk management services to partners in the OTC market.

Trading Hours

The standard trading hours for the MX are 9:30 a.m. what's more, 4:30 a.m. ET. Every option class opens for trading when a trade happens on its underlying issue on a recognized Canadian exchange. Assuming no such trade has yet happened, the option class will open for trading at 9:35 a.m. ET.

Automation Process

The exchange hit an achievement in 2001 when it turned into the principal traditional exchange in North America to complete the automation cycle. After three years, the Montreal Exchange turned into the principal foreign exchange to give an American exchange — the Boston Options Exchange (BOX) — with electronic trading systems and support. TMX likewise possesses a stake in the Boston Options Exchange.

Features

• The MX is Canada's most established exchange and Quebec's super financial derivative market.
• MX clearinghouse, the Canadian Derivatives Clearing Corporation (CDCC), gives all clearinghouse services to exchange participants.
• The MX presently records equity derivatives, currency options (options on the U.S. dollar), index derivatives, and interest rate derivatives (bond and money markets).
• The Montreal Exchange (MX) is a Canadian, completely electronic derivatives exchange.
• The Montreal Exchange was acquired by the TSX Group on Dec. 10, 2007; the subsequent merger prompted another name for the group: TMX Group.