Charles Gaa is a Policy Advisor in the Canadian Economic Analysis Department (CEA). He conducts analysis and research on topics related to the Bank’s monetary policy and financial system functions, with a focus on housing. He is also part of the leadership team that guides and manages the work of the department.
Charles first joined the Bank of Canada in the Financial Markets Department, where he worked for several years before leaving to continue his studies. Prior to re-joining the Bank of Canada in the Financial Stability Department, where he served as the Director of the Financial Institutions Division, he was on the faculty at the University of Oregon. Most recently, he joined CEA just prior to the start of the pandemic and helped to lead the department's contribution the Bank's Monetary Policy Report from 2020 to 2025. Charles holds a PhD in Finance from the University of British Columbia and is a CFA charterholder.
The stability of the Canadian financial system, as well as its ability to support the Canadian economy, depends on the ability of financial institutions to absorb and manage major shocks. This is especially true for large banks, which perform services essential to the Canadian economy.
Innovations in communications and information technology and the related globalization of financial markets have created the potential for important changes to the structure of Canadian equity markets. Established marketplaces can now compete more effectively on an inter-regional and international basis. At the same time, reduced costs have lowered the barriers to entry faced by new competitors known as alternative trading systems (ATSs). In response to this heightened competition, established Canadian stock exchanges have taken measures to improve market quality.
While regulators see innovation as positive for the development of Canadian markets, there is some concern that market liquidity may be fragmented in the short run. The Canadian Securities Administrators have proposed a framework that attempts to address this issue and that would allow ATSs to compete with traditional exchanges for the first time.
The authors provide an overview of the Canadian equity market and its structure, focusing on these recent developments.
