To put in place an order execution policy to enable FAML when it is providing portfolio management services to retail clients to comply with the obligation in the Conduct of Business Rules COBS 11.2A of the Financial Conduct Authority. The obligation is to take all sufficient steps to obtain the best possible result for its retail clients (taking into account the execution factors) when placing orders with other entities for execution that result from decisions by FAML to deal in financial instruments on behalf of its retail clients.
Identify in respect of each class of instruments, for each entity with which orders are placed and confirm that such entity has execution arrangements that enable the firm to comply with its best possible result obligation.
FAML has put in place this policy in order to consistently achieve the best possible result across all orders when placing orders for execution in respect of financial instruments covered by MIFID II. FAML shall monitor and review the effectiveness of this policy and update it to ensure FAML continues to achieve such results.
FAML’s obligation to achieve the best possible result under MIFID II does not relate to a transaction by transaction analysis but to a requirement to take all reasonable steps to achieve the best possible result overall when placing orders for execution on the Customer’s behalf including having regard to the following execution factors:
c) Speed to execute order;
d) Likelihood of execution or settlement;
e) Size and nature of the order; and
f) Any other considerations.
The weight given to any of these factors will be affected by reference to the client’s characteristics, the nature of the order, the financial instrument in question and the possible execution venue. Price will normally be the most important of these factors for obtaining the best possible result though for example when trading an illiquid financial instrument certainty of execution may be more important than price.
FAML transmits orders for all types of financial instruments to its appointed brokers for execution.
FAML has reviewed the appointed brokers order execution policy and is satisfied that the necessary arrangements are in place to enable it to achieve the best possible result for the client as described in this policy.
The appointed brokers will save in exceptional circumstance place orders that FAML places with them with particular execution venues; a regulated market or a multilateral trading facility.
FAML considers that the execution services that its specialist execution brokers provides are keenly priced and efficiently provided both online and by telephone.
FAML is required by the FCA to obtain each client’s prior consent to its Order Execution Policy which shall be given if a client appoints FAML to manage funds on its behalf on the Terms of Business to which this policy is attached.
Monitoring of the Policy
FAML will monitor on a regular basis the effectiveness of this policy.
FAML shall review the policy regularly and in any event at least annually.
FAML shall review the policy whenever a material change occurs that affects FAML’s ability to obtain the best possible result for its clients.
In conducting such reviews FAML shall explore the execution services that are available from other execution brokers.