The siren rang this morning at the Toronto Stock Exchange, signalling the official opening of TSX Quantum, the exchange’s new trading platform.

The first symbol to trade on the new trading engine is “X”, the symbol of TSX Group Inc.

Rik Parkhill, president, TSX Markets and executive vp, TSX Group, flanked by a small group of industry members, counted down to launch the technology that the TSX says will herald a new era of trading in Canada.

“I think it was just a couple of years ago that we used to talk about trading speeds in terms of seconds and then it went to milliseconds and now we are down to micro-seconds,” said Parkhill at a small reception in the TSX broadcast centre, just before today’s launch.

Quantum, the TSX Group’s new proprietary trading engine, is designed to provide vastly improved messaging capabilities and linearly scalable throughput with response times in the single digit millisecond range.

A potentially viable competitor for the TSX is making its way over the horizon in the form of Project Alpha, being put together by the investment arms of the big six banks and independent investment dealer Cannacord Capital Inc. Alpha should be up and running sometime in 2008 and Quantum is one way the TSX can fight to maintain its market share.

“More importantly, the Quantum engine and the new trading infrastructure that we’re rolling out significantly reduces the cost of operations for the TSX and that’s going to result in lower cost for our customers,” said Parkhill.

Two order types, “Min Fill” and “Lots Of”, will not be available on TSX Quantum. Therefore, Min Fill and Lots Of orders cannot be re-filled after they are purged from the current trading engine when a listed security l is moved to the new engine. TSX Quantum will support all other order types and functionality available on the current trading engine.

“What we’re trying to do with TSX Quantum is make sure that all of our trading rates are at the single digit millisecond latency, if not lower,” said Parkhill. “ And that we’ve got a huge amount of surplus capacity on hand at all times to process the explosion in messaging rates,” he added.

The new system is also expected to give the TSX the capacity to expand into the derivatives business in 2009.

“It’s good for our customers because it allows you to attract more business. It adds more liquidity to the market and that’s good for investors generally,” Parkhill said.