Montreal Exchange Inc.
|Key People||Luc Fortin, President and CEO|
|Products||Futures and options in equities, indexes, interest rates and currencies|
The Montréal Exchange (MX), a part of TMX Group following a 2008 acquisition, provides trading, clearing and settlement of futures and options in equities, indexes, interest-rates and currencies on its electronic platform. The Canadian group also has equity interests in the Boston Options Exchange, the Montreal Climate Exchange and the Canadian Resources Exchange (Carex).
The Montréal Exchange was ranked as the world's 30th-largest derivatives exchange by volume in 2010 according to the annual volume survey published by the Futures Industry Association (FIA). The FIA report, published in March of 2011, notes that the exchange's total volume for 2010 jumped by 27.5% from the previous year, reaching about 44.3 million contracts.
The Montréal Exchange is Canada's oldest financial exchange, established in 1874 after 40 years of informal trading, primarily in financial and railroad stocks. It merged with the Canadian Stock Exchange in 1974, introducing stock options a year later, the first move towards dropping cash equities and becoming a pure-play derivatives exchange in 2005.
The clearing unit was established in 1977 and, with derivatives becoming more important, changed its name to the Montréal Exchange in 1982. MX became Canada's sole derivatives exchange in 1999, when it also joined Globex under a 10-year agreement which gave it a monopoly over futures and options, while TSX became the sole equities platform. The looming expiry of the deal had seen the TSX announce plans to start a derivatives business after 2009.
MX demutualized in 2000, taking full control of the clearinghouse. Full automation was introduced in 2001. The MX became a founding shareholder in the Boston Options Exchange in 2002 - BOX launched in February 2004 - with a 31.4 percent stake, announcing plans in October 2007 to lift this to 53.2 percent by acquiring shares from the Boston Stock Exchange. In December 2005 it became a pure-play derivatives operation, and also signed a joint venture with the Chicago Climate Exchange to launch the Montreal Climate Exchange. The exchange opted to go public in 2006, listing its share on the TSX in March 2007. The same month saw a deal with the New York Mercantile Exchange to establish Carex, with NYMEX taking a 10 percent stake in the MX. TMX Group, formerly known as TSX, the owner of the Toronto Stock Exchange, acquired the Montreal Exchange in a $1.3 billion transaction in 2008. The merged entity is now known as the TMX Group. MX shareholders approved the deal on February 13, 2008.
MX currently lists:
- Equity derivatives (equity options)
- Currency derivatives (options on the US dollar:US/CAD)
- Index derivatives  
- Interest rate derivatives (bond and money markets)
The three most active of Montreal Exchange's individual products (not including equity options as a group) include 10-year government of Canada bond futures (CGB), 3-month Canadian Bankers' Acceptance futures (BAX),and S&P Canada 60 Index Futures (SXF). In November 2007, Montreal added futures on 30-year government of Canada bonds.
The exchange introduced a new futures product based on the performance of the FTSE Emerging Markets Index on June 13, 2014. The FTSE Emerging Markets Index Futures (MX-EMF) are targeted at market participants seeking exposure to emerging markets for hedging, asset allocation, speculation and arbitrage.
In September 2014, Montréal Exchange (MX) and Eris Exchange announced a licensing agreement for MX and Canadian Derivatives Clearing Corporation (CDCC) to offer trading and clearing of Canadian Dollar swap futures and options based on the Eris Methodology.
On June 15, 2020, Montréal Exchange announced the launch of CORRA Futures, a new three-month futures contract based on the Canadian Overnight Repo Rate Average (CORRA) benchmark. CORRA is designed to measure the average cost of overnight general Government of Canada collateral repo transactions and serves as a representative measure of overnight funding rates.The launch coincided with the Bank of Canada taking over the administration of the CORRA interest rate benchmark.
The MX clearing house, the Canadian Derivatives Clearing Corporation (CDCC), provides central counterparty clearing services to participants. It holds a top investment rating and a strong reputation. The CDCC has completed regulatory rule changes allowing the clearing house to offer risk management services to partners in the OTC market.
The Montreal Exchange traded 44,296,907 contracts in 2010, up a little more than 27 percent from the previous year.
The Montréal Exchange ranked number 30 in 2009 in the Futures Industry Association's global list of top 53 derivatives exchanges measured by volume but declined 8% on 2008's volume figure. The FIA list, published in early April 2010, reports that that Montreal Exchange's total volume for 2009 dropped to 34.8 million from 38 million in 2008.
The Market Data Services of the Montréal Exchange (the MX) manages sale and distribution of market data. It certifies vendors and establishes external and internal distribution and subscriber fee policies for real-time and delayed market data. Market data is available in the following types:
- Real-time basis
- Delayed basis (at least 15 minutes)
- End-of day summary basis
- Luc Fortin, President and CEO
- Glenn Goucher, President & Chief Clearing Officer
- Claude Cyr, Senior Vice President, Financial Markets
- Léon Bitton, Vice President, Research & Development
- Brian Z. Gelfand, Vice President, Institutional Relations and Market Operations
- François Gilbert, Vice President, Legal Affairs, Derivatives
John Lothian News Interviews
In this video from JLN's Industry Leader Series, Montréal Exchange President and CEO Luc Fortin talks about the exchange’s extended hours, potentially partnering with a firm in Asia to spread the word, and the relaunch of a key interest rate derivative.
“The world is looking to trade more and more Canada and the fact that we’re only open during our own time zone is a bit prohibitive for some of the international clients.”
Last year, Montréal Exchange launched single stock futures and it turned out to be its best product launch in a decade based on rapidly growing open interest. The exchange also revamped its 5-year bond contract in order to make sure all points on the curve are accessible. With those changes in place, 2017’s goals center around structural change.
- 2010 Annual Volume Survey. Futures Industry.org.
- History. MX.
- TSX joins consolidation race with Montreal deal. Financial Times.
- Press release. MX.
- Press Release. MX.
- Press release. Montreal Exchange.
- Press release. MX.
- "Equity Options”. www.m-x.ca.
- "Options on the U.S. Dollar”. www.m-x.ca.
- "Indices”. MX.
- Options List: Index and ETF options, Equity options, Currency options. MX.
- "Interest rates”. www.m-x.ca.
- "Monthly reports”. www.m-x.ca.
- MX expands govt. bonds. www.bloomberg.com.
- Montreal Exchange to Introduce Futures Contracts on the FTSE Emerging Markets Index. Automated Trader.
- Montréal Exchange Launches CORRA Futures. TMX.
- TMX Group Inc. 2010 Annual Report (PDF). TMX Group.
- 2009 Annual Volume Survey. FIA magazine.