Order Execution Policy
CXM Prime Ltd (“CXM Prime”) CXM Prime Office No. 518 15 St Helen's Place, London, England, EC3A 6DQ, Registered in England and Wales, Company Number: 13407617 is authorised and regulated by the Financial Conduct Authority (“FCA”) FRN: 966753 CXM Prime Limited ("we", "our" or "us") will treat its clients ("you", "your", "yours") honestly and fairly. We are committed to acting in your best interests when you enter into any transaction with us on all our trading platforms.
We are obligated to provide you with "best execution". Best execution means that we must take all sufficient steps to obtain the best possible result for you when executing a transaction with you or on your behalf, taking into account various "execution criteria".
This document provides our Order Execution Policy for all our clients, the aim of which is to achieve best execution.
This Policy forms part of our Terms and Conditions and so by agreeing to our terms you are also agreeing to the Order Execution Policy.
How we achieve best execution for you.
When we enter into transactions with you, we will take all sufficient steps to achieve the best possible result for you by executing those transactions according to our order execution policy and subject to any specific instructions received from you. Our order execution policy comprises a set of procedures that are designed to obtain the best possible execution result for you subject to and taking into account:
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the underlying market in which you have traded (liquidity, volatility etc);
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the nature of your trade (size, stop loss, opening trade etc;
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any specific instructions that you have given us in relation to such trades; and
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the market practices of the exchange in question,
with the aim of producing a result which, in our opinion, provides the best balance across a range of sometimes conflicting factors and the pre-eminent circumstances for achieving best execution.
Our Criteria for best execution
We consider that the criteria for best execution are the same across all of the markets offered by us.
For all clients the best possible result will be determined in relation to the following, in order of importance,
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price achieved
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the costs involved (although in nearly all cases these costs will be known in advance)
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speed of execution
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likelihood of execution (size of transaction, liquidity, specific instructions involved)
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settlement considerations
In most instances best execution will be evident from the trade price requested by the client and the achieving of that price (or, indeed, a better one) but where this is not immediately achievable we will use our experience to realise, in our opinion, the best result for our clients.
The order of importance of these criteria may alter in line with market conditions and any variation will be adjudged in line with our experience.
For example, in times when liquidity is poor, "speed of execution" may prove less important than "likelihood of execution" as trying to buy or sell when there is very low liquidity may adversely affect the eventual price achieved. Or if your transaction size is large a better result may be attained by requesting market maker bids rather than just trading directly into an exchange.
Indeed, speed of execution may also, at times, be more important than immediate price. For instance, when a trade is being executed prior to a corporate announcement or where a large stop order has been triggered and we may need to take into consideration the risk of the client’s exposure to excess losses necessitating immediate execution regardless of price.
Best execution for CFDs/Forex (OTC trades)
When executing trades in such instruments, clients should be aware that we act as principal in all such transactions and not as an agent. This means that we are the market maker and the settlement (and therefore the risks) of the trades are with us and not with a third party. In simple terms, when you win, you win directly from us and, when you lose, you lose directly to us.
We act as the sole execution venue for the execution of your transactions. Any position that you take with us can only be closed via our platform and not through any other provider.
The way that we ensure best execution is that we take the prices from the underlying markets of the contracts concerned and deliver these to you (with such adjustments as are relevant to such instruments). These prices are taken from liquidity providers and reflect, in our view, the best prices available for off exchange transactions.
For some markets we offer prices for our clients even though there may not be a relevant underlying market or exchange open at that time. The quotes that we offer in these markets are based upon a variety of factors such as the price activity prevalent in related markets, other possible market influencing events and the current state of our own exposure to risk.
We will automatically process all trade requests immediately upon receipt. Most trade requests will be accepted or rejected immediately but those that are above a certain size may be transferred to a dealer to be manually processed. At certain times of increased liquidity we may decide to process all trades manually.
Where your trade takes us over our exposure limits we may work such instructions in the underlying market and then pass the fill level on to you.
We will only ever partially fill an order as an alternative to an outright rejection. We will never partially fill your order as an alternative to filling it in its entirety.
Execution Venues
Whilst we act as principal in respect of your orders, we assess the venues available to us for the pricing, hedging and execution of your transactions. We view that price and costs for clients are the most important factors in our choice of venue but we will also take into account how each of the other execution factors are affected for example, speed of processing and likelihood of order acceptance in a variety of markets and order types. The financial soundness and order execution policies of any counterparty or venue are also considered.
We manage our risk as market maker by hedging your transactions in the underlying market. This may affect the price of the transaction that we enter into with you, taking into account the prevailing market prices available to us.
Our Order Execution Policy means that we may execute your transactions outside a regulated market or an MTF. Whilst this approach allows us to consistently source the best price for your orders it brings with it a greater counterparty and settlement risk compared to trading on exchange.
Professional Clients
If you are classified as a Professional client under the meanings given to that classification by the FCA we will consider relevant regulatory guidance in determining whether we are acting on your behalf and whether you are legitimately relying on us to deliver best execution in relation to your order.
This includes such matters as
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who initiates the transaction;
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market practice;
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levels of price transparency; and
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any other relevant factors, including information provided by us and any agreement reached.
We recognise that you will be relying on us to provide best execution and we will therefore execute your order in line with this policy. In certain circumstances our determination of the relative importance of the execution factors may differ including for example where the choice of execution venue or the likelihood of execution may take precedence over price.
Conflict of Interest
Whilst it is not usual, there may be times when a client instruction is being transacted at the same time as an instruction from CXM Prime Limited. In all such instances, the client trade request will hold precedence over our activity. This includes situations where your transaction is aggregated with transactions arising from our hedging activities.
Aggregation
Where we can demonstrate that such an action was in your best interests we may aggregate your transactions with those of other clients. We may also aggregate your transactions with our own orders for the purposes of hedging other client activity for execution as a single order.
We will pursue this policy where we reasonably believe that it is in the overall best interests of our clients to do so. This means that whilst it is unlikely to work overall to your disadvantage, on occasions, aggregation may result in you obtaining a less favourable price in relation to a particular order once your instruction to close a transaction or for us to execute a transaction on your behalf has been conducted.
The reason we may sometimes aggregate orders is that it reduces the time it takes to get all orders to market. For example, the execution of many small orders one at a time could ‘signal’ to the market that this pattern may continue which may result in our clients getting worse fills than if we sent one, single order to the market. This may be particularly important in illiquid, quote driven or fast moving markets.
Order Allocation
Where an aggregated order is partially filled in the market, allocation to clients will be distributed proportionately across all clients. In all instances, the allocation will be undertaken on a fair and reasonable basis with reference to factors such as order type, price and volume where it may not be practical or deemed fair in our view to fill orders proportionately, for example, in the case of de minimis orders. In this way we shall ensure that allocation will not be undertaken in a way which gives unfair precedence to any particular person.
Whilst not usually the case, in the event that your order is aggregated with orders arising from our hedging activities we shall allocate your orders in priority to ours. If however, we are able to demonstrate on reasonable grounds that the aggregation of your order with ours allowed the execution on more advantageous terms, or indeed at all, then we may allocate the orders proportionally.
On rare occasions and only where we believe that it will not be detrimental to you, we may reallocate your orders. We consider that in this context detriment would be caused if as an effect of the reallocation, unfair precedence is given to us or to any particular client.
Specific Client Instructions
Where you give us specific instructions over how you wish your order to be handled such instructions will override the relevant factors in our "Criteria for Best Execution" (clause 2. Above). Such instructions might include but are not limited to specifying a venue where you wish a Transaction to be executed; specifying the price of a CFD contract with us; specifying the price at which a CFD contract is to be closed if the market moves against you; or to ‘work’ an order.
All other criteria for best execution will remain in place and we will continue to apply the policy for the aspects of an order not affected by the specific instructions.
Order Execution
A position held by you which has an attached Stop Loss will be closed if the price is reached.
A normal stop order may be filled at a less favourable level depending on the events surrounding the triggering of the stop.
Monitoring of this Order Execution Policy
We will monitor the effectiveness of our order execution policy. We will assess on a regular basis whether the price feed and hedging venues relied on in pricing our products allow us to achieve best execution on a consistent basis or whether we need to make changes to our execution arrangements. We will also review our order execution arrangements and order execution policies regularly whenever a material change occurs either in respect of one of our chosen pricing venues or otherwise that affects our ability to continue to achieve best execution.
Should there be any material changes to our order execution arrangements or order execution policy, we will notify you accordingly.
Material Changes
We will notify clients of any material changes to its order execution arrangements or order execution policy as described above by posting the information on its website.
No Fiduciary Relationship
Nothing within this policy implies any fiduciary responsibilities from us to you other than any specific regulatory obligations.
Clients remain responsible for their own investment decisions and the Firm will not be responsible for any market trading loss clients suffer as a result of those decisions.
Breaches of Order Execution Policy
Any breaches of the Order Execution Policy will be recorded on the Firm’s breach log.