A new booklet published by the Investment Dealers Association of Canada aims to help firms in choosing a carrying broker.

The 15-page booklet, “What to consider when choosing a carrying broker”, is available on the IDA Web site.

The booklet describes introducing/carrying relationships and what firm’s need to consider before choosing to enter such a relationship.

Introducing/carrying relationships between brokerage firms allow a firm to provide full service to their clients without bearing the large start-up and maintenance costs of operating a complete full-service back office to clear and settle securities transactions.

Carrying relationships are playing an increasingly important role for the independent dealer segment in Canada, the IDA reports, with over half of current IDA members operating as Introducing Brokers.

An introducing/carrying agreement must be executed between the Introducing Broker and the Carrying Broker and the two firms must be member firms of either the IDA or the Bourse de Montréal Inc. MFDA firms can’t yet be carried by IDA firms.