[Toronto, CANADA] The provincial securities regulatory authorities and The Toronto Stock Exchange have relieved E*TRADE Canada from the Suitability Rule, effective today.
While operating under the Suitability Rule, brokers are required to review all customer orders to determine if they are consistent with the customer’s general investment objectives and risk profile.
For discount brokers, this process, commonly referred to as “order vetting”, often results in trade delays. The lifting of the Suitability Rule by securities regulators means that orders will no longer have to be reviewed and will now transfer directly to the market for execution.
The removal of the order vetting step means orders can be executed faster with less exposure to market movement on high volume trading days.
“The lifting of the Suitability Rule for discount brokers by securities regulators is the most significant development to date in terms of leveling the playing field for investors in Canada,” said Colleen Moorehead, E*TRADE Canada chief executive officer.
“Our customers want to make their own investment decisions, using the comprehensive investment tools and information available to them. The change to the Suitability Rule means that they will now be able to fully utilize our professional VERSUS trading technology which means for them institutional quality trading.”
E*TRADE Canada is encouraging its current customers to visit www.canada.etrade.com/suitability and watch the Web site for more details on how to take advantage of this important change.