ORDER EXECUTION POLICY
(August 2019)
Overview of Best Execution requirement
ZFX is obliged to act in our clients’ best interests and, other than in certain circumstances described below, where we execute or arrange the execution of orders, we are required to take all reasonable steps to obtain the best possible result for our clients (known as delivering ‘’best execution’’) and to establish and implement an order execution policy and related procedures to allow us to do so.
We have internal policies and procedures governing how we will act when we execute orders for our clients. We continually strive to provide the best possible level of service to all of our clients. Consequently, our policies and procedures are under constant review and may be revised at any time without prior notice.
Execution Venues
We deal with clients as principal and not as agent. This means that we are the execution venue and so clients transact directly with us and not on an exchange or another external market. Trades that clients undertake with us are non-transferable, which means that if a client opens a position with us, they must close the position with us.
Execution Factors
We apply the following execution factors:
(i) The Price – While we always aim to act in the best interest of our clients we cannot guarantee that the price at which we permit clients to execute a trade will be better than elsewhere. Prices on Contract for Difference (CFD) products are sourced from independent third party providers who supply liquidity to the OTC market.
(ii) The Cost – We add a mark-up to the prices from our liquidity providers and publish the ‘’markedup’’ prices that include our income. We will base the closing price of the relevant currency for the purposes of margin requirements and any balance credits/debits.
(iii) Speed and Likelihood of Execution – Trades may be executed on our platform or by telephone or other forms of communication. Screen and telephone trades are subject to liquidity and market conditions and so we cannot guarantee that a client’s trade will be open or closed instantaneously. The speed and likelihood of execution is also subject to software, hardware and telecom/data line use and we cannot guarantee that this will not be free of interruption of suspension.
(iv) Quantity – We set the minimum and maximum quantity that clients may place on a trade. This is influenced by market conditions and firm policy and changes from time to time.
Price and cost are the predominant Execution Factors used by ZFX.
Execution Criteria
When arranging a transaction or executing a client order, we will take into account the following criteria for determining the relative importance of the execution factors referred to above:
(i) The characteristics of the client including the categorisation of the client;
(ii) The characteristics of the client order; and
(iii) The characteristics of the financial instruments that are the subject of that order.
Dealing with Client Orders
Subject to market conditions a client order will be executed at our price or very close to our price. The price clients receive at execution is not guaranteed as the market may widen, become very volatile or even gap. There is no guarantee that a client’s order will be executed.
We are under no obligation to honour and may cancel client order under the circumstance which we reasonably believe that any form of market abuse, regulatory breach, or the client order was transacted at an incorrect price may have taken place.
Specific Instructions
If clients have any particular requirements as to how we act when dealing with them, then they must let us know and we will do our best to accommodate them. However, clients should be aware that where they give us specific instructions that are incompatible with our normal order execution policies and procedures, their specific instructions will take precedence.
This may result in a different outcome that would have been achieved had our normal policies and procedures been followed and, we will not be required to deliver best execution in respect of the aspects of a client order which are covered by their specific instructions.
Our normal policies and procedures take account of the costs that we would incur in transacting business. Transactions may be subject to additional charges. Where this applies, we will notify clients of the applicable charges before their order is executed.
Our Duty of Best Execution
When executing orders OTC financial derivative products, we will take all reasonable steps to achieve the best possible outcome taking into account our Order Execution Policy and any specific instructions received from our clients.
Achieving Best Execution
To achieve the best possible result, we will take a number of factors into account, including price, costs, speed of execution, likelihood of execution and settlement, size, nature of the order or any other factors relevant to the execution of that order.
We will use our own commercial experience and judgment in determining the relative importance of these factors, however, we have rated prices as the most important factor for obtaining the best possible result.
If we have classified a client as a Professional Client, we will consider relevant guidance to determine whether they are relying on us to deliver best execution. We understand that clients may be relying upon us to deliver best execution, but the importance of execution may take precedence over price.
If we have classified a client as an Eligible Counterparty, there is no requirement for us to deliver best execution to them. However, we will comply with this policy in relation to Eligible Counterparty business and maintain records of data which are used to set our prices.
We will review this policy at regular intervals and will monitor and review external pricing sources.
We will give clients 14 days written notice where we make any change to this policy and the client disclosure relating to this policy on our website.