Hi Guys,
Please read below an email just from FXCM:
FOREX CAPITAL MARKETS LIMITED
(“FXCM UK ”)
Execution Policy Disclosure Statement
Please read below an email just from FXCM:
FOREX CAPITAL MARKETS LIMITED
(“FXCM UK ”)
Execution Policy Disclosure Statement
November 2007
FXCM Execution Policy Disclosure Statement
- This policy statement applies to professional clients and retail clients only.
- Under FSA rules (COBS 11.2), FXCM is required to take all reasonable steps to obtain the best possible result (or “best execution”) on behalf of its clients either when it executes client orders or when it receives and transmits orders for execution. These rules require firms to put in place an execution policy and to provide appropriate information to its clients on its order execution policy.
- This policy only applies when FXCM executes orders on a client's behalf. FXCM considers itself to be in receipt of an order where an execution instruction is given if it gives rise to contractual or agency obligations to the client. Specifically, this will be the case where the client commits to a trade that is not immediately executable, leaving discretion with FXCM as to the manner of execution and exact terms of the resulting transaction.
- FSA rules provide that a firm satisfies its obligation to take reasonable steps to obtain the possible result for a client to the extent that it executes an order, or a specific aspect of an order, following specific instructions from the client relating to the order or the specific aspect of the order (COBS 11.2.19R(2)).
- Although FXCM will be a client's counterparty to executed foreign currency transactions, all orders from a client in relation to foreign currency will be routed to Forex Capital Markets LLC (a US domiciled affiliate of FXCM, regulated by the National Futures Association) for execution.
- All orders received by FXCM will therefore be treated as a specific instruction, in accordance with FSA rules and the terms of this policy, to execute transactions with Forex Capital Markets, LLC. By acting on such specific instructions, FXCM satisfies its obligation under FSA rules to take all reasonable steps to obtain the best possible result for its clients when executing an order with Forex Capital Markets, LLC.
- FXCM procedures are established to ensure that orders executed on behalf of clients are promptly and accurately recorded and allocated and that it carries out otherwise comparable orders sequentially and promptly unless the characteristics of the order or prevailing market conditions make this impractical or the interest of the client require otherwise.
- In circumstances where FXCM executes trades with Forex Capital Markets LLC, we require a client's express consent to execute orders on its behalf on venues other than an EEA regulated market or an EEA multi-lateral training facility (namely the FXCM On-line Facility) before we can execute a client's order. FXCM
November 2007
FOREX CAPITAL MARKETS LIMITED
(“FXCM UK ”)
Policy on Conflicts of Interest
November 2007
FXCM Policy on Conflicts of Interest - This policy summarises certain policies adopted by Forex Capital Markets Limited (“FXCM”) for compliance with the requirements of the UK Financial Services Authority (“FSA”) relating to the management of conflicts of interest. This policy applies in respect of all activities undertaken by employees of FXCM.
- FXCM takes responsibility for identifying and managing any conflicts of interest arising in its business that may entail a material risk of damage to the interests of clients. FXCM have considered, in particular, the potential conflicts of interests arising out of the execution of foreign exchange transactions for its clients. Under FSA rules, a firm is required to take all reasonable steps to identify conflicts of interest between:
- FXCM, including its managers, employees and FXCM's affiliates directly or indirectly linked to it by control, and a client; or
- one client of FXCM and another client.
- FXCM does not undertake any proprietary trading. The main conflicts of interests which may arise in the conduct of FXCM's business are the potential conflicts of interest between one customer and the firm's duties to other customers. FXCM has accordingly developed this policy and appropriate procedures to manage these actual and perceived conflicts.
- The following measures have been adopted in relation to such conflicts of interest:
- When FXCM executes an order for a client it shall not give any preferential treatment to that client to the detriment of other clients and shall not disclose the details of one client order to other clients.
- FXCM executes all orders in accordance with its policies and procedures that comply with relevant rules and regulations in relation to transactions which are executed for or on behalf of clients. FXCM's procedures provide for the prompt, fair and expeditious execution of client orders, relative to other orders. These procedures allow for the execution of otherwise comparable orders in accordance with the time of their reception by FXCM.
- FXCM procedures are established to ensure that orders executed on behalf of clients are promptly and accurately recorded and allocated and that it carries out otherwise comparable orders sequentially and promptly unless the characteristics of the order or prevailing market conditions make this impractical or the interest of the client require otherwise.
- FXCM's procedures are established to ensure that FXCM, its employees and affiliates do not misuse information relating to pending client orders.
- All employees of FXCM are required to comply with FXCM's rules and procedures on personal account dealing, in particular that transactions in foreign exchange investments be conducted through FXCM or an approved broker.
- All employees of FXCM are prohibited from accepting gifts or other inducements from any person with any material interest which is likely to conflict to a material extent with any duty which FXCM and/or its employees owe to customers in connection with its investment business or any duty which such a recipient owes to its customers.
- FXCM is committed to having an effective and appropriate compliance culture to enable it to deal with any new potential conflicts of interest which may arise in the future. FXCM's employees are therefore required to monitor any new circumstances giving rise to potential conflicts and to implement appropriate measures to address these including but not limited to establishing information barriers.
- In the unlikely event that FXCM's arrangements to manage conflicts of interest are not sufficient to ensure, with reasonable confidence, that risks of damage to the interests of a client will be prevented, FXCM must clearly disclose the general nature and/or sources of conflicts of interest to a client before undertaking business for them.
FXCM
November 2007
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