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Alpha Group to introduce new ETF trading fee structure


Alpha Group will implement a new exchange-traded fund trading fee structure as of 1 January 2011, subject to regulatory approval.

For all ETFs with a value greater than or equal to CAD5, active fees will be reduced from 35 mils per share to 25 mils per share and passive fee rebates will be reduced from 31 mils per share to 21 mils per share.

This fee reduction positions Alpha as the market with the lowest active fees for trading ETFs – a segment that represents a substantial component of the overall volume traded in Canada across all Canadian marketplaces.

For a dealer facing a majority of taker trades, this new fee schedule represents close to 30 per cent savings on these trades.

The new fee schedule comes on top of a series of other features at Alpha: free opening trades, an existing “25 mils/-21 mils” fee structure for all securities with a value greater than or equal to CAD1 and a value below CAD5, full rebates on iceberg orders, not capping rebates and the lowest active/passive ratio for dealers posting their resting orders on Alpha.

"In 2010, the industry started to reap the benefits of our commitment to reducing the cost of trading in Canada," says Jos Schmitt, chief executive of Alpha Group. "Now that we have reached a substantial market share in ETFs, it is time again for us to demonstrate that we live up to our commitments. We are all about finding the right balance between the interests of all our constituents: our recent and major technology upgrade has been most beneficial to our HFT community; this fee reduction is most beneficial to our Canadian retail dealer community."

Alpha Group was established in May 2007 by nine Canadian financial institutions with the aim of increasing the country’s securities trading efficiencies and making the Canadian marketplace more globally competitive.

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