Briefly: “TMX Group in alliance with London exchange” and more news

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Canada’s largest securities exchange, TMX Group, has inked a deal with the London Stock Exchange that will allow the U.K. market to adopt the SOLA trading system for derivatives. SOLA was developed by Montréal Exchange, a division of TMX.

“TMX is very proud of the SOLA technology, and we are pleased that London Stock Exchange Group has chosen the platform for its derivatives businesses,” said Thomas Kloet, CEO of TMX. “We are also very excited about the opportunity to participate in the growth and development of the European derivatives market.”

The LSE is developing a new equity derivatives business, called EDX London. TMX is currently negotiating a minority ownership stake in EDX London.

“The use of SOLA will give the group a state-of-the art, proven derivatives trading platform, significantly increasing our ability to develop our derivatives markets,” said Clara Furse, chief executive of London Stock Exchange Group. “Moreover, our partnership with TMX offers exciting scope for developing new products, building on our recent success with our highly liquid Russian derivatives market.”

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New fundco launches Shariah fund

Promising lower volatility and an ethics-based investment philosophy, Global Prosperata Funds has announced the launch of the Global Iman Fund, a Shariah-compliant product that focuses on socially responsible investing.

Islamic Shariah law forbids many of the trading practices that are at the core of the financial crisis: financial leveraging, short-selling and derivatives. Because charging interest violates Shariah, investors would also avoid exposure to the banking sector.

“This kind of fund, I believe, can help rebuild confidence in the markets,” says vice-president Glenn Moore, Global Prosperata Funds Inc. “In the current financial environment, there are advantages in applying some Shariah-compliant strategies found within the Islamic financial marketplace.”

The Global Iman Fund also avoids industries such as alcohol, tobacco, firearms and gambling. The fund is eligible for most registered investment accounts, although approval for RESP use is still pending.

The fund is the first to be offered by Global Prosperata Funds, which is currently developing Shariah-compliant Canadian and emerging markets mandates.

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Income gap widening in B.C.

The income gap between the wealthy and the middle class is growing in British Columbia, with 60% of families earning less than comparable families in the 1970s, according to a study by the Canadian Centre for Policy Alternatives.

Between 1976 and 2006, real pre-tax earnings fell for the families in the bottom 60% of the income scale in B.C..

The poorest 10% of the population saw real incomes plummet by 74%. The sixth decile — those ranking between the top 50% and top 60% — had their real incomes cut from $70,000 in 1976 (in today’s dollars) to $65,000 in 2006.

“Recent studies and media reports have focused on the vulnerability of poor British Columbians as we enter a recession,” says report author Iglika Ivanova. “But our study shows that the middle class is vulnerable too — and much more so than in the rest of Canada.”

The study also found that families in the top 10% of the B.C. income spectrum now earn more than the entire bottom half of the population.

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Scotia rebrands discount brokerage

Scotiabank has rebranded its recently acquired online discount brokerage service, changing the name from E*TRADE to Scotia iTRADE. Investors now have access to research and analysis from Scotia Capital.

“Scotia iTRADE brings the unique offering of E*TRADE Canada into the Scotiabank family of brands,” said Barbara Mason, executive vice-president, wealth management, Scotiabank. “Scotia iTRADE builds on E*TRADE Canada’s innovation, brand character and competitive pricing, resulting in a comprehensive and unique online investing offer.”

Scotia bought E*TRADE Canada in September 2008.

(03/10/09)