Information About Our Order Execution Policy

Fox-Pitt, Kelton Limited (referred to herein as FPKL, ‘we” or “us” for the purposes of this document), is bound by the requirements of the European Union’s Markets in Financial Instruments Directive (known as “MiFID”) and the Conduct of Business (“COBS”) rules of the Financial Services Authority (“FSA”). COBS require FPKL to take all reasonable steps to achieve what is called “best execution” in relation to your orders. We have in place an Order Execution policy “the Policy” designed to obtain the best possible execution result. This document contains information specifically in relation to this policy.

This document contains six sections:

1. Scope and purpose
2. Achieving Best Execution
3. Compliance with Client Instructions
4. Choosing an Execution Venue
5. Updating the Policy
6. Contact Details

Please note that FPKL is not authorised to undertake investment activities as defined under MiFID with retail customers. If you are a retail customer please contact one of the people named in the Contacts section for further information.

1. Scope and Purpose

FPKL is dedicated to providing the highest quality service to its clients and we endeavour at all times to act fairly, honestly and reasonably in dealing with our clients. Under the requirements of MiFID and COBS, we are required to establish and implement a Policy on best execution, where we provide order execution services to our clients.

Our commitment to provide you with best execution does not mean that we owe you any fiduciary responsibilities over and above the specific regulatory obligations placed upon us or those which may be contracted between us.

When does the Policy apply?

The scope of the Policy is only applicable in circumstances where we are executing an order on your behalf in respect of a financial instrument which is within the scope of MiFID. This will be the case when:

• We act on your behalf.
• We agree to achieve the best price or other terms for you in the market.

This Policy will not generally apply when we are not executing an order on your behalf, or where we transact with you but not on the basis of having received an order from you. This is likely to be the case:

• Where we are acting as a dealer and offering to enter into a transaction with you or accepting to enter into a transaction with you as a principal.
• Where we are acting as your counterparty for our own account.
• When you transact with us as principal on the basis of a “request for quote”.
• To the extent that we are following your instructions to execute your order in a particular manner.
• When you are categorised by FPKL as an “eligible counterparty” (if you are in doubt as to your categorisation, please contact one of the persons contained herein).

Those financial instruments which are within the scope of MiFID include most financial instruments apart from spot FX transactions and spot commodity derivative products.

2. Achieving Best Execution

What does Best Execution mean?

Best execution means that when executing orders on behalf of clients, we will take all reasonable steps to obtain the best possible result for our clients.

We are required by COBS to:

• Establish a Policy which sets out how we will achieve the best possible result across all orders on an overall consistent basis for any financial instrument covered by MiFID and executed by us for our clients.
• Comply with the Policy.
• Review and update the Policy at least annually and whenever a material change occurs to ensure that it continues to achieve such results.

We will take into consideration a range of different factors, when executing orders, which include not just price, but which may also include such other factors as the cost of the transaction, the need for timely execution, the likelihood of execution and settlement, the size of the order, the nature of the financial transaction (including whether it is executed on a regulated market or over the counter) and any other consideration relevant to the execution of an order, such as the liquidity of the market.

Price will ordinarily merit a high relative importance in obtaining the best possible result but there may be circumstances in which we appropriately determine that other factors are equally or more important. The relative importance of each of the factors will differ depending on:

• The characteristics of the client.
• The characteristics of the order.
• The characteristics of the financial instrument.
• The characteristics of the execution venue (if, and where, there is more than one) where we are able to execute your order.

What is our responsibility when your order is executed for us by a third party?

On occasion we may pass an order for execution to another FPK entity or a third party. The third party may be a broker.


We may pass your order to an affiliated FPK entity in cases where the entity with whom you have a direct relationship does not have the ability to execute the order but the affiliated entity does have the ability. We have standard procedures for passing such orders to our affiliates for execution in these circumstances. Where the affiliate is outside of the EEA it may not be subject to requirements similar to the best execution requirements under MiFID but in using such affiliate we are still required to comply with the overreaching best execution requirement. Please note that the FPK affiliated entities that FPKL would use are: the US Registered Broker Dealer Fox-Pitt Kelton Cochran Caronia Waller (USA) LLC Incorporated, which is regulated by FINRA, and Fox-Pitt, Kelton (Asia) Limited, which is regulated by the Hong Kong Securities and Futures Commission.

Where we use a third-party broker which is not an FPK affiliated entity, we do so in your best interests and with the aim of achieving the best possible outcome for the execution of your order. We have procedures to review periodically our choice of third-party brokers and dealers to ensure that the third-party broker is providing best execution on a consistent basis. In this regard, we may make this determination on the basis of a review of the best execution policy of the relevant broker or dealer.

What is our responsibility when we execute your order from our own book ?

Where we are, in effect, ourselves the execution venue, that is where we deal directly with you on a principal to principal basis, we will review the quality of our own execution as if we were an execution venue and disclose the criteria used by us to judge the quality of the execution offered by us to you. However, you should note that, where a regulated market may charge exchange fees which reflect the quality of its execution facilities, we have to price the cost of our own business model and utilisation of our capital to support our dealings with you (e.g. credit risk) as part of the assessment of the quality of execution offered to you. However, we will trade in this way only where applying the factors that apply to the choice of venue.

How does the Policy apply to structured and over the counter (OTC) transactions?

Structured products and OTC transactions are largely undertaken by the FPKL Investment Banking division. Where we are acting on your behalf and we execute an order in respect of a structured transaction such as a forward future, option or other derivative, on a regulated exchange or multilateral trading facility, we will apply the same approach to achieving best execution as we do for other financial instruments. Normally we will not be acting on your behalf in relation to structured transactions but as your counterparty. In such circumstances, we will not owe you the duty of best execution.

Our policy is to exercise the same standards and operate the same processes across all the different markets and financial instruments on which we execute your orders so far is possible and subject to the processes set out in the Policy. However, the diversity in those markets and instruments and the kind of orders that you may place with us mean that different factors will have to be taken into account when we assess the nature of our Policy in the context of different instruments and different markets. For example, there is no formalised market or settlement infrastructure for OTC transactions. In some markets, price volatility may mean that the timeliness of execution is a priority, whereas in other markets that have low liquidity the fact of execution may itself constitute best execution. In other cases, our choice of venue may be limited because of the nature of your order or of your requirements.

Subject to your prior agreement, in some instances we may execute your orders outside of a regulated market or MTF where we believe this will result in the best possible result for the execution of your order.

3. Compliance with Client Instructions

What happens if you provide us with specific instructions in relation to how to execute your order?

Where you provide us with a specific instruction in relation to the execution of all or part of your order we will follow that instruction to the extent it is possible for us to do so. We will have no responsibility for compliance with the Policy to the extent that we accept and follow your instructions. We will satisfy the best execution obligation in respect of the part or aspect of the order to which the client instructions relate.

This means for example, that the Policy will apply:

• Where you instruct us to execute your order on a particular venue.
• Where you instruct us to execute your order at a particular time or over a particular period regardless of the price available, we will execute your order at that time or over that period in the best possible manner but will not be responsible for the timing or any consequences for prices or other factors that result from the timing of execution.

What is our responsibility where you do not give us a specific instruction?

In such circumstances, and at our sole discretion, we will consider all the factors relating to the Policy in providing you with best execution.

4. Choosing an Execution Venue

Which trading venues will we use ?

FPKL will use a selection of venues for the purposes of executing your order. For the purposes of the Policy and for MiFID, a venue may include a regulated market, a multilateral trading facility (MTF), systematic internalisers; own account dealing, third parties (including affiliates) and non-EU entities carrying out similar functions. Each venue used by us is reviewed periodically. In some cases there will be only one appropriate venue, whereas in other cases we may use more than one venue.

Where your order is to be executed on a particular regulated market or trading venue where FPKL is a member, your order may be executed by us as a member of that regulated market. Where FPKL uses an affiliate, the executing entity will be acting on behalf of the FPK entity of which you are a client unless we agree with you otherwise.

Where we use third parties, we will undertake a periodic review of such parties taking into account the various factors as set out above to ensure that they are providing best execution. Such review will take place on at least an annual basis.

In selecting the most appropriate venues for the purpose of executing your orders, we will take into account the factors relevant to the order and we will reasonably assess what is in your best interests in terms of executing your orders. Typically, we will take into account such other factors as may be appropriate, including the ability of the venue to manage complex orders, the speed of execution, the creditworthiness of the venue and the quality of any related clearing and settlement facilities.

Where we have a choice of venues in respect of a particular order, how do we choose ?

We may have access to more than one venue for executing an order. When choosing between different venues, we will take into account factors such as cost of execution and accessibility of the venue and assess which venue is likely to provide the best possible result for the order. Where there is only a single venue available for the purposes of executing your order, we will presume that this is to be the best possible outcome for the purposes of this Policy.

What factors might vary between choices of venue ?

Obtaining the best possible price is often a priority in the execution of orders. However, in some markets price volatility may mean that timeliness of execution is a priority. In other markets that have low liquidity, the fact of execution may itself constitute best execution.


How often do we review our venues ?

Generally we will review the venues we use to execute your orders on at least an annual basis.

5. Updating the Policy

FPKL will update the Policy periodically but no less than on an annual basis, taking into account any material market and regulatory changes as and when appropriate.

6. Contacts

Compliance	Samantha Guthrie	+44 (0)20 7073 2315	samantha_guthrie@fpk.com
Trading	Daniel Addison	+44 (0)20 7663 6091	daniel_addison@fpk.com
Sales Trading	Ken Wesson	+44 (0)20 7663 6088	ken_wesson@fpk.com

Click here to view a pdf of our Order Execution Policy.