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Compliance
The Effect of Leverage:
Transactions in futures carry a high degree of risk. The amount of initial margin is small relative to the value of the futures contract so that transactions are "leveraged". A relatively small market movement will have a proportionately larger impact on the funds you have deposited or will have to deposit; this may work against you as well as for you. You may sustain a total loss of initial margin funds and any additional funds deposited to maintain your position. If the market moves against your position or margin levels are increased, you may be required to deposit substantial funds on short notice to maintain your position. If you fail to comply with a request for additional funds within the time prescribed, your position may be liquidated at a loss and you will be liable for any resulting deficit.
Suspension or Restriction of Trading, and Pricing Relationships:
Market conditions (e.g. illiquidity) and/or the operation of the rules of certain markets (e.g. the suspension of trading in any contract or contract month because of price limits or "circuit breakers") may increase the risk of loss by making it difficult or impossible to effect transactions or liquidate/offset positions. If you have sold options, this may increase the risk of loss.
Trading Facilities:
Most open-outcry and electronic trading facilities are supported by computer-based component systems for the order-routing, execution, matching, registration and/or clearing of trades. As with all facilities and systems, they are vulnerable to temporary disruption and/or failure. Your ability to recover certain losses may be subject to limits on liability imposed by the system provider, the market, the clearing house and/member firms.
Electronic Trading:
Trading on an electronic trading system may differ not only from trading in an open-outcry market but also from trading on other electronic trading systems. If you undertake transactions on an electronic trading system, you will be exposed to risks associated with the system including the failure of hardware and software. The result of any system failure may be that your order is either not executed according to your instructions or is not executed at all. Your ability to recover certain losses, which are particularly attributable to trading on a market using an electronic trading system may be limited to less than the amount of your total loss.
Day Trading is Extremely Risky:
Day trading generally is not appropriate for someone of limited resources and limited investment or trading experience and low risk tolerance. You should be prepared to lose all of the funds that you use for day trading. In particular, you should not fund day-trading activities with emergency funds, funds set aside for purposes such as education or home ownership, or funds required to meet your living expenses. Further, certain evidence indicates that an investment of less than $50,000 will significantly impair the ability of a day trader to make a profit. Of course, an investment of $50,000 or more will in no way guarantee success.
Be Cautious of Claims of Large Profits from Day Trading:
You should be wary of advertisements or other statements that emphasize the potential for large profits in day trading. Day trading can also lead to large and immediate financial losses. Day trading requires knowledge of securities markets Day trading requires in-depth knowledge of the securities markets and trading techniques and strategies. In attempting to profit through day trading, you must compete with professional, licensed traders employed by securities firms. You should have appropriate experience before engaging in day trading.
Day Trading Requires Knowledge of a Firm's Operations:
You should be familiar with a securities firm's business practices, including the operation of the firm's order execution systems and procedures. Under certain market conditions, you may find it difficult or impossible to liquidate a position quickly at a reasonable price. This can occur, for example, when the market for a stock suddenly drops, or if trading is halted due to recent news events or unusual trading activity. The more volatile a stock is, the greater likelihood that problems may be encountered in executing a transaction. In addition to normal market risks, you may experience losses due to system failures.
Day Trading will Generate Substantial Commissions, Even if the Per Trade Cost is Low:
Day trading involves aggressive trading, and generally you will pay commissions on each trade. The total daily commissions that you pay on your trades will add to your losses or significantly reduce your earnings. For instance, assuming that a trade costs $10 and an average of 20 transactions are conducted per day, at 260 trading days in a year, at that pace, you will have paid 52 000 in commissions.
Day Trading on Margin or Short Selling may Result in Losses Beyond your Initial Investment:
When you day trade with funds borrowed from a firm or someone else, you can lose more than the funds you originally placed at risk. A decline in the value of the securities that are purchased may require you to provide additional funds to the firm to avoid the forced sale of those securities or other securities in your account. Short selling as part of your day-trading strategy also may lead to extraordinary losses, because you may have to purchase a stock at a very high price in order to cover a short position.
Handling of Orders
A. Orders received prior to the 9:30 am: Will be entered to the pre-opening session of a marketplace with trading hours of 9:30 am to 4:00 pm unless otherwise specified by the investor.
B. Orders received after 4:00 pm: Will be entered the next business day to the preopening
of a marketplace with market hours from 9:30 am to 4:00 pm unless specified by the investor for execution in the afterhours markets.
C. Order treatment and routing: Orders are valid between the hours of 9:30 a.m. and 4:00 p.m. EST. Orders received after the open of a Marketplace, will be routed to the marketplace with the best available price through the use of smart order router technology. Unfilled orders will expire on the marketplace where the order was last routed. In the event a marketplace is not available, orders will be re-routed to other marketplaces on a best-efforts basis. Day orders booked prior to 4:00 pm on markets utilizing an after-hours facility may execute up to 5:00 pm that day.
Risk of Lower Liquidity:
Liquidity refers to the ability of market participants to buy and sell securities: generally, the more orders that are available in a market, the greater the liquidity. Liquidity is important because with greater liquidity it is easier for investors to buy or sell securities, and as a result, investors are more likely to pay or receive a competitive price for securities purchased or sold. There may be lower liquidity in extended hours trading as compared to regular market hours. As a result, your order may only be partially executed, or not at all.
Risk of Higher Volatility:
Volatility refers to the changes in price that securities undergo when trading. Generally, the higher the volatility of a security, the greater its price swings. There may be greater volatility in extended hours trading than in regular market hours. As a result, your order may only be partially executed, or not at all, or you may receive an inferior price in extended hours trading than you would during regular market hours.
Risk of Changing Prices:
The prices of securities traded in extended hours trading may not reflect the prices either at the end of regular market hours, or upon the opening the next morning. As a result, you may receive an inferior price in extended hours trading than you would during regular market hours.
Risk of Unlinked Markets:
Depending on the extended hours trading system or the time of day, the prices displayed on a particular extended hour trading system may not reflect the prices in other concurrently operating extended hours trading systems dealing in the same securities. Accordingly, you may receive an inferior price in one extended hour trading system than you would in another extended hours trading system.
Risk of News Announcements:
Normally, issuers make news announcements that may affect the price of their securities after regular market hours. Similarly, important financial information is frequently announced outside of regular market hours. In extended hours trading, these announcements may occur during trading, and if combined with lower liquidity and higher volatility, may cause an exaggerated and unsustainable effect on the price of a security.
Risk of Wider Spreads:
The spread refers to the difference in price between what you can buy a security for and what you can sell it for. Lower liquidity and higher volatility in extended hours trading may result in wider than normal spreads for a particular security.
Canaccord Genuity Direct is furnishing the information to you to provide some basic facts about purchasing securities on margin, and alert you to the risks involved with trading securities in a margin account. Before trading stocks in a margin account, you should carefully review the margin agreement provided by Canaccord Genuity Direct. Please consult a Canaccord Genuity Direct representative regarding any questions or concerns you may have with your margin account. When you purchase securities, you may pay for the securities in full or you may borrow part of the purchase price from Canaccord Genuity Direct If you choose to borrow funds from Canaccord Genuity Direct you will open a margin account. The securities purchased are Canaccord Genuity Direct collateral for the loan to you. If the securities in your account decline in value, so does the value of the collateral supporting your loan, and as a result, Canaccord Genuity Direct can take action such as issue a margin call and/or sell securities in your account in order to maintain the required equity in the account.
It is important that you fully understand the risks involved in trading securities on margin, including:
You can lose more funds than you deposit in the margin account:
A decline in the value of securities that are purchased on margin may require you to provide additional funds to the firm that has made the loan to avoid the forced sale of those securities or other securities in your account.
The firm can force the sale of securities in your account:
If the equity in your account falls below the maintenance margin requirements under the law or the firm's higher "house" requirements, the firm can sell the securities in your account to cover the margin deficiency. You also will be responsible for any shortfall in the account after such a sale.
The firm can sell your securities without contacting you:
Some investors mistakenly believe that a firm must contact them for a margin call to be valid, and that the firm cannot liquidate securities in their accounts to meet the call unless the firm has contacted them first. This is not the case. Most firms will attempt to notify their customers of margin calls, but they are not required to do so. However, even if a firm has contacted a customer and provided a specific date by which the customer can meet a margin call the firm can still take necessary steps to protect its financial interests, including immediately selling the securities without notice to the customer.
You are not entitled to choose which security in your account should be liquidated to meet a margin call:
Because the securities are collateral for the margin loan, the firm has the right to decide which security to sell in order to protect its interests.
The firm can increase its "house" maintenance margin requirements at any time:
The firm is not required to provide you with advance written notice. These changes in firm policy often take effect immediately and may result in the issuance of a maintenance margin call. Your failure to satisfy the call may cause the member to liquidate or sell the securities in your account.
You are not entitled to an extension of time on a margin call:
While an extension of time to meet margin requirements may be available to customers under certain conditions a customer does not have a right to the extension.
Options involve risks and are not suitable for all investors. It is very important that option investors be fully aware of the characteristics and risks of standardized Options by reading carefully our "Disclosure statement for recognized market options" and also our "Option trading agreement" before engaging in options trading. Both of these documents are available through your Canaccord Genuity Direct representative. Canaccord Genuity Direct also would like to inform investors of the inherent risks of trading the following strategies.
- Bullish strategies have greater risk of loss in falling markets.
- Neutral strategies have greater risk of loss in volatile markets.
- Bearish strategies have greater risk of loss in rising markets.
There are many factors that an investor should be aware of when trading options including interest rates, volatility, stock splits, stock dividends, stock distributions, currency exchange rates, etc. Canaccord Genuity Direct shall reduce any accounts that exceed applicable position limits to a level that is in compliance with such limits. Any losses as a result of these actions will be the sole responsibility of the investor. Typically, the exercise of in-the-money equity options is automatic at expiration, if the equity options is $0.01 or more in the money. Index options will be exercised automatically, if in-the-money by $0.01. For all options in the money less than $0.01 or out of the money, it will be your responsibility to request exercise by 4:15 pm EST before expiration on the last day of trading (Options expire on the 3rd Friday of each month). We may exercise any open equity option that is $0.01 or more in the money on the date of expiration. You are obligated to monitor your options position(s) especially as the expiration date approaches. If you exercise an in-the-money option, you must have sufficient equity in your account to meet margin requirements. Canaccord Genuity Direct may, at its own discretion, reduce or close-out your options positions prior's positions prior to the close of business on the last day before exercise, if the account has insufficient equity to meet margin requirements. Investors should only engage in options trading that is best suited to their financial condition and option experience and which considers current market conditions. Orders are accepted only on an unsolicited basis. Investors are solely responsible for any and all orders placed in their account(s) and at their own risk.Canaccord Genuity Direct does not make any recommendations whatsoever regarding any options or options strategies. Additionally, your account(s) are accepted on a fully disclosed basis and solely at the discretion of the firm.
Canaccord Genuity Direct does not solicit or recommend transactions, or provide investment advice, to investors in OTC/Bulletin Board, Pink Sheet or CNQ securities. All transactions in these markets are accepted on an unsolicited basis only. These types of securities represent low priced shares of new or small companies that do not qualify for trading on NASDAQ or TMX or TMXV national stock exchanges. OTC Bulletin Board, Pink Sheet and CNQ securities include national, regional, and foreign equity issues, warrants, units, American Depositary Receipts (ADRs), Direct Participation Programs (DPPs), and penny stocks. The inherent risks in trading these securities include, but are not limited to, the following: - Trading in these securities can be very risky, and may not be appropriate or suitable for you. - When trading in these securities, you may lose all or part of your invested capital. Any adverse report of a company's deteriorating financial condition, or news which would affect the company's financial condition, may lead to a dramatic decline in the price of a security. - Frequent name or symbol changes, stock splits, and delistings occur in these securities. This brings about a conversion risk. In selling more shares than your originally thought you owned. - Typically, all stocks falling into these categories are non-marginable. They cannot be purchased on margin or be used as collateral against margin loans. - Accurate quotation information, immediate executions, execution reporting, and the delivery of legal trade confirmations might not be readily available. - Heavy market volatility may prevent or delay order processing. - These types of securities are frequent targets of fraud or market manipulation, not only because of their generally low price, but also because the reporting requirements for these securities are less stringent than for listed or NASDAQ and TMX or TMXV traded securities, and no exchange requirements are imposed. - Due to lower trading volumes in many of these securities, there may be a lower likelihood of orders receiving executions, and current prices may differ significantly from the price quoted at the time of placing your order. Prior to trading in these types of securities, you should consider your investment objectives, financial resources, risk tolerance and experience. As described above, trading in OTC Bulletin Board, Pink Sheet and CNQ securities differs significantly from trading in NASDAQ or TMX or TMXV listed securities, and you may experience greater market risk. You should be familiar with these risks before trading in them. You should also take the time to read available prospectuses and any other filings, including quarterly and annual financial reports, for a company carefully before trading.
Canaccord Genuity Direct would like to inform you of the potential risks of trading online and the inherent risks of trading in an extreme market environment. When trading online, you should be aware that during periods of high internet traffic, you might experience delays in accessing account data due to systems capacity limitations. Additionally, system response times may be adversely affected by increased market volatility conditions, quote delays, system performance; and other factors outside the control of Canaccord Genuity Direct which may include your computer system and internet service provider. You may also experience system outages or delays as a result of, among other things, power failures, programming failures or heavy trading volume. During periods of increased volatility, you might suffer market losses in the price and share volume of a particular stock when systems problems result in an inability to place buy or sell orders. The risk of financial loss in trading online can be substantial; therefore, you should consider whether such trading is suitable for you in light of your circumstances and financial resources. In the event system capacity problems prevent our automated routing systems from sending your order(s) to designated market centers for execution, we encourage you to contact our Trading Desk for manual handling of your orders. We ask for your patience, during those times, because the Trading Desk will be experiencing heavy call volume. Please keep in mind that Canaccord Genuity Direct takes significant measures to improve system capacity and reliability; however, you should have an alternate means of trading your securities including a back-up platform here at a Canaccord Genuity Direct or an account at another securities brokerage firm. During extreme market conditions, you might experience delays in order executions because market making firms will temporarily discontinue normal automatic order execution standards and switch to a manual order process, and/or reduce their size guarantees on individual stocks. You may also experience executions at prices significantly away from the market price quoted or displayed at the time an order was entered, fewer shares than desired, or losses. To potentially reduce your risk of receiving an execution away from the market, it is a good idea to use limit orders rather that market orders in a fast-moving market. Although, this method also could in effect not guarantee you a fill.
A market order is an order to buy or sell a stated amount of a security at the best possible price at the time the order is received on the marketplace. Market orders will be filled; however, you cannot be sure of the price. Stock prices vary based on current conditions, and these conditions are not always reflected on your computer screen. The actual price at which your order is filled may be better or worse than you expected. A limit order is an order to buy or sell a security at a specified price or better. Your order will not be filled unless the stock trades at that level. Placing a limit order, however, is not a guarantee that your trade will be executed at your limit price. It does, however, eliminate the risk that your order will be filled at a price worse than you expected. A stop order is an order to buy or sell a stock at the market price once the price reaches or passes through a specified price, called the "stop price." This type of order is used by investors who own a stock and want to make sure they sell it, if the stock price starts to drop. The stop price placed on a sell stop order must be below the current bid price of the security. Stop orders in volatile issues will not guarantee you an execution at or near the stop price. Once triggered, the order competes with other incoming market orders. Stop orders can be placed for buy orders as well. The stop price specified for a buy order must be above the current asking price. A stop limit order performs like a stop order with one major exception. Once the order is activated (by the stock trading at or "through" the stop price), it does not become a market order. Instead, it becomes a limit order with a limit price equal to the former stop price. The advantage of this order is that you set a specified price at which your order can be filled. The disadvantage is that your order may not be filled in certain fast market conditions. In this case, your exposure for loss will continue until the position is closed. You should pick the type of order that is best suitable for your situation and which considers current market conditions. Your orders are accepted only on an unsolicited basis. You are solely responsible for any and all orders placed in your account(s) and at your own risk Canaccord Genuity Direct does not make any recommendations whatsoever regarding any security or securities product. Additionally, your account(s) are accepted on a fully disclosed basis and solely at the discretion of the firm.
Canaccord Genuity Direct has not reviewed the content of any third-party website, which is linked to its own site nor is it responsible or liable for the content of any third-party website. Canaccord Genuity Direct provides third party links solely as a convenience and for educational or informational purposes to its users. By linking to any third-party website, you do so at your own risk and acknowledge leaving the website of Canaccord Genuity Direct. Any opinions or recommendations expressed on any third-party website are solely those of the independent providers and are not the opinions, recommendations or necessarily the views of Canaccord Genuity Direct. Also, Canaccord Genuity Direct does not provide any legal, tax, accounting or investment advice concerning the suitability or profitability of any security or investment. Canaccord Genuity Direct does not warrant the timeliness, accuracy or completeness of any facts, material or information contained on any third-party website. Canaccord Genuity Direct reserves the right in its sole discretion to add or discontinue links to any third-party website at any time and for any reason. Trademarks, logos, and service marks represented on this website are trademarks of their respective companies. Permission was granted for their use. Finally, the third-party providers are independent companies of Canaccord Genuity Direct.
Email messages are intended only for the use of the intended recipients, and it may contain information that is privileged and confidential. If the reader of the email message is not the intended recipient, or an employee or agent responsible for delivering the email message to the intended recipient, such reader is hereby notified that any review, retransmission, conversion to hard copy, copying, circulation or other use of the email message is strictly prohibited and may be illegal. If you have received the email communication in error, please immediately notify us by replying to the message and deleting it from your computer. Canaccord Genuity Direct reserves the right to monitor all communications sent by e-mail through its networks. Instructions related to operations sent by email will not be accepted. In no way does this notice limit other more restrictive warnings that may have been sent to you by Canaccord Genuity Direct.
The following outlines Canaccord Genuity Direct’s policies and procedures for dealing with complaints.
A "complaint" is deemed to include an alleged grievance involving Canaccord Genuity Direct or an employee.
Examples of a complaint may include:
- Any written statement, including email or fax, of a client, or any person acting on behalf of a client;
- Any written or verbal statement from any person alleging: theft, fraud, misappropriation of funds or securities, forgery, money laundering, market manipulation, insider trading, misrepresentation, or unauthorized trading;
- Any other verbal complaint from a client that will warrant the same treatment as a written complaint.
We are responsible for responding to your feedback effectively and efficiently, and for resolving any complaint you may have regarding your Canaccord Genuity Direct accounts. In most cases, a complaint can be resolved by client services or their manager. However, should you feel your complaint cannot be resolved by client services or their manager, contact our Designated Complains Office (“DCO”) directly at:
Canaccord Genuity Corp.
C/O Designated Complaints Officer
PO Box 10337
609 Granville Street, Suite 2200
Vancouver BC Canada
V7Y 1H2
The DCO is responsible for acknowledging your complaint within 5 days of its receipt. The acknowledgement letter will include the contact information of the person handling your complaint, a summary of our complaint handling procedures, the timeframe in which you can expect to receive a substantive response to your complaint, and the escalation steps available to you should you remain dissatisfied with our complaint examination findings. Submitted with the letter will also be a copy of CIRO's “An Investor’s Guide to Making a Complaint” pamphlet. The substantive response letter we sent to you will include a summary of your complaint, an explanation of our investigation, our final decision, and your available options should you be dissatisfied with that decision.
Effective June 1, 2022, due to a change in securities regulations, Order-Execution-Only dealers like Canaccord Genuity Direct (“CG Direct”) may not accept payment of mutual fund trailers. As a result, CG Direct will not allow purchases or accept transfers of mutual funds that pay trailing commissions.
If you are currently holding a trailer paying mutual fund that is subject to a DSC redemption fee, CG Direct will provide you with a dealer rebate directly into your account.
A dealer rebate is credited to you in cash, by CG Direct which is equal to the amount of the trailer paid by the Investment Fund Manager to us and will be paid directly to your account for as long as you hold your trailer paying mutual fund in your CG Direct account.
Dealer rebates will be paid to your account on a quarterly basis and will be reflected as a dealer rebate payment detailed on your month end statement. You may access your statement information by selecting the Activity Tab in Directfolio → Documents → Statements.
If you require further information regarding dealer rebates, please contact our client services department via email at clientservices@cgdirect.ca or contact us directly at (514) 985-8080 or 1-866-608-0099.
