At the Investment Dealers Association’s annual conference in Whistler, B.C. today, Richard Nesbitt, president TSX Markets, spoke about the Toronto Stock Exchange’s plans to build liquidity and secure its future as a viable market in Canada.

Regarding the once highly touted global equity market alliance with the NYSE, Nesbitt said, “Don’t hold your breath [about the GEM] moving ahead this year.” He said that the TSX is still supportive of the GEM alliance, but conceded that the TSX is at the mercy of the NYSE as to whether the deal goes ahead. Highlighting its tenuous nature, Nesbitt stressed that the TSX is open to a deal with Nasdaq, too. He suggested that the world of exchanges would likely develop into one of alliances, similar to the airlines, rather than creating a single, global world market.

Apart from the market alliance issue, Nesbitt also revealed that the TSX is considering whether to expand some of its products to the TSX Venture market. And, it is contemplating opening a U.S. dollar version of the TSX book. Nesbitt noted that U.S. dollar trading would allow the TSX to compete for some of the 33% of all Canadian stock trading that is handled in the U.S. However, he allowed that would also hurt the business of Canadian brokers that only deal in Canadian stocks trading in Canadian dollars.

While these developments are under consideration, Nesbitt also reported that later this year the TSX will be introducing a market-on-close product. He said that it has been working with the regulators to develop an approach to trading on the close. It will likely start with the S&P/TSX 60 stocks, and then it will decide how to expand it to the rest of the market. It will also be releasing a paper at the end of the month on market maker reform.

Another critical issue for the TSX includes the migration of registered traders from big firms to smaller ones. The opposite trend has been observed in the U.S., giving them a greater liquidity advantage over Canadian traders. Nesbitt said that the TSX needs some solution to this issue.

He also noted that the exchange will be looking to exploit its corporate database to generate more revenue with a new business to be called TSX Datalinx. The TSX is seeking to diversify its own revenue streams, while also winning back liquidity from the U.S. and the upstairs market.