Scotiabank, BestEx Research Partner on New Trading Platform

Scotiabank (BNS) announced Wednesday it has entered into a strategic agreement with BestEx Research Group for stocks, futures and foreign exchange trading.

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Reshaping Electronic Trading for Canadian Equities

Scotiabank and BestEx Research will create a next generation algorithmic trading platform specifically designed for the Canadian equity market.

Scotiabank will be the only Canadian bank to provide access to this trading platform in the Canadian market through its line of multi-asset electronic products, ScotiaRED. (See Analysts’ Top Stocks on TipRanks)

BestEx Research’s algorithms are based on research-driven quantitative ordering logic, which departs from the heuristic approach of most vendors and includes a cloud-based Algorithm Management System (AMS) that offers unprecedented transparency and control over real-time orders.

This next-generation platform, slated for launch in the second quarter of 2022, will feature cutting-edge technology designed to meet to the unique needs of the Canadian market, rather than relying on execution algorithms originally designed for U.S. markets.

Management Commentary

“Working with BestEx Research, we will deliver a next-generation algorithmic trading platform and address the market’s need for better performance, transparency and control,” said Paul O’Hea, Global Head, Equity Sales and Trading at Scotiabank.

Wall Street’s Take

On December 1, RBC Capital analyst Darko Mihelic kept a Buy rating on BNS and raised its price target to C$99 (from C$89). This implies 16.3% upside potential.

Mihelic stated that Scotiabank fourth-quarter results were better than expected thanks to good credit performance and lower spending. The analyst added that he remains positive on the bank as its results follow higher loan growth, with other benefits coming from interest rate increases.

The rest of the Street is bullish on BNS with a Strong Buy consensus rating based on six Buys and two Holds. The average Bank of Nova Scotia price target of C$90.58 implies 6.4% upside potential to current levels.