The last two years have seen a fundamental shift in the way Americans buy and sell shares, as the Yanks went electronic in a big way. There's every expectation that Canada is about to follow suit.
A study released last week shows Canadian institutional investors are rushing to embrace technology. Six out of 10 money managers are now using the advanced order management systems that allow for electronic trading. That's up almost threefold in two years.
These statistics come from a survey of 30 Canadian money managers with $1-trillion in assets.
"2006 will be a turning point for the Canadian institutional equity markets,' predicts Jackie Chung. ”The telephone will be replaced by electronic order routing as the dominant method of trade communications."
Next year, 20 per cent of Canadian trading is seen coming through electronic networks. Obviously, this requires new skills from anyone working on an equity desk.
The report says that, in the future, "traders will be adding value beyond trade execution and be more involved in the investment process."
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