KEPLER CHEUVREUX BEST EXECUTION POLICY

Transcription

1 KEPLER CHEUVREUX BEST EXECUTION POLICY Art. 1 - Introduction When receiving and executing or transmitting orders on behalf of "Clients", each relevant Kepler Group entity (Head office, branches and subsidiaries) together referred to as ( Kepler Cheuvreux or "we" or "us"), will take all reasonable steps to fulfill the Best Execution obligation, as defined in the Markets in Financial Instruments Directive ("MiFID"). Therefore, we have put in place this policy (the "Policy") as well as procedures and arrangements designed to obtain the best possible result for our Professional Clients. Our commitment to take all reasonable steps to fulfill the best possible execution does not mean that we owe our Clients any fiduciary responsibilities over and above the specific regulatory obligations placed upon us or as may be otherwise contracted between us and our Clients. Art. 2 - Scope CLIENTS This Policy applies to "Professional Clients". "Eligible Counterparties" will therefore not fall under the provisions set out in this document. ORDERS This Policy applies when Kepler Cheuvreux receives and executes or transmits to an external third party broker ("Third Party Broker") an Order ("Order"), on behalf of a Client, irrespective of the Client's country of residence. Orders executed against Kepler Cheuvreux proprietary book with full Client acknowledgment, when the Client requests for quote, or negotiates the terms of an Over-the-Counter ("OTC") transaction will be excluded from the scope of this Policy. FINANCIAL INSTRUMENTS' SCOPE The "Financial Instruments" covered by the Policy refer to the Financial Instruments listed in MiFID, and in particular to the Financial Instruments offered by Kepler Cheuvreux in relation to the financial services provided by Kepler Cheuvreux on any relevant execution venue ("Execution Venue"). 1

2 Art. 3 - Best Execution Factors When executing Client Orders, Kepler Cheuvreux will take into consideration the following factors (by order of importance) : 1. Price 2. Expected impact of execution 3. Likelihood of execution and settlement 4. Costs 5. Speed 6. Size and nature of the order 7. Other factors relevant to the execution of a particular order We will also take into account whether it is executable on a regulated market ("Regulated Markets") or outside a Regulated Market. Although we would ordinarily expect price to have a high degree of importance relative to the other specified factors, its precise importance in the context of any given order will depend upon the criteria specified below and may also be affected by any Specific Client Instructions (as defined in article 6). Art. 4 - Best Execution Criteria We will determine the relative importance of the above mentioned factors based upon our commercial experience and judgment in the light of available market information at the relevant time and taking into account the Best Execution criteria based upon the following characteristics: Client categorization Order, including any Specific Client Instructions related to that order Financial Instruments that are the subject of that order (Equities and equity like instruments together called Cash Equities ) Execution Venues to which that Order can be directed Art. 5 Factors affecting our choice of Execution Venues OUR SELECTIVE APPROACH When executing Client Orders, we will choose Execution Venues that we consider the most appropriate: we will assess the different Execution Venues available to identify those that will enable us, on a consistent basis, to obtain the best possible result for executing Client Orders. Therefore, we believe it would not be cost effective to become a member of all new liquidity pools without assessing their capacity to provide a significant improvement in terms of liquidity and prices; hence our selective approach. This approach is based on an analysis of significant historical data with a view to evaluating the following criteria: Client orders may be executed through the following Venues Core factors Discriminating factors Liquidity Probability of execution Credit risk as regards the clearing process attached to the Venue system availability Operational risk in terms of Speed of execution The Venues on which Kepler Cheuvreux will execute orders is listed in Appendix I. This list will be reviewed at least once a year, and from time to time Kepler Cheuvreux may execute orders on Venues 2

3 that are not included in it where we deem it appropriate in accordance with this Policy. An updated version of this list is available on Kepler Cheuvreux website: Please note that Kepler Cheuvreux can benefit from rebates from the MTFS when placing passive orders. ROUTING ORDERS - USE OF THE SMART ORDER ROUTER As soon as the decision is taken to send the order to the market, it will be directed towards the Venue offering the best possible result, using Kepler Cheuvreux Smart Order Routing System. The Smart Order Routing System is an automated system that supports Kepler Cheuvreux to route the order to the execution venue that Kepler Cheuvreux considers to generally provide the Best Execution. Kepler Cheuvreux may execute orders outside regulated markets and multilateral trading facilities. In such a case, a prior consent from the client is requested by Kepler Cheuvreux (see article 11 of the current policy for further details). If a single Venue is specified by the Client, the Order is executed directly on the specified Venue according to the Client's preference. If the Venue is not specified, the order routing system will direct the order to the Venue which maximize the likelihood of Best Execution, in accordance with the principles set out in this Policy. CHAIN OF EXECUTION USE OF THIRD PARTY BROKERS There will be instances when Kepler Cheuvreux will transmit an order for execution to a Third Party Broker. Kepler Cheuvreux has a preferred panel of Third Party Brokers for each jurisdiction in which it has no local presence or no market membership. These Third Party Brokers have been chosen after review of a set of parameters, including regulatory, technology and cost related issues as well as their Best Execution Policy. This panel of Third Party Brokers will be reviewed periodically as to the quality of their execution. If Kepler Cheuvreux determines that a Third Party Broker is not providing Best Execution in accordance with this Policy, it will be removed from the preferred panel unless and until such as its execution improves. Kepler Cheuvreux will annually review, for each third party broker 1. The cost 2. The latency factor 3. Evolution of unsettled trades 4. Local market membership status 5. Operating incidents review 6. Best execution report Art. 6 - Specific Client Instructions Where a Client gives a Specific Instruction relating to the execution of an Order (for example, to execute an order on a particular Venue), the relevant part of the Order will be executed in accordance with those instructions. Clients should be made aware that providing Specific Instructions may prevent us from taking the steps which we have designed and implemented to obtain the best possible result for the execution of such Order in respect of the elements covered by those instructions. Art. 7 - Aggregation of Orders 3

4 Kepler Cheuvreux may aggregate orders effected on the Client behalf with the Orders of other Clients. By combining the Client Orders with those of other Clients, Kepler Cheuvreux must reasonably believe that this is in the overall best interests of its Clients. However, the effect of the aggregation may operate on some occasions to his disadvantage in relation to a particular Order. Management of grouped orders (1) All orders with the same direction on the same financial instrument where the execution is simultaneous are aggregated in a dedicated account grouped orders. Transactions are all assigned to this account so that each of the grouped orders has the same execution average price in proportion to 1/ their respective quantity when there is no execution instruction, or 2/ the instructions of volume or timeframe execution for each of the grouped orders. (2) In the case one order would have a price limit, it is the trader s responsibility not to report executions with an inappropriate price, but to affect them in the conditions described above on the orders where executions match the execution instructions by creating a second order for Grouped Orders, on which executions will be affected in the conditions described in (1). (3) When various orders are simultaneously executed using the account Grouped Orders, and one of them has is suspended or cancelled, executions placed on account Grouped Orders must be allocated to each order in the appropriate proportions, and a news order created on account Grouped Order with the remaining quantities to execute. Again, executions will be affected on this account so that all orders will have the same execution average price, in proportion of their respective quantities when there is no execution instruction, or in proportion of the conditions of time or volume instructed for each order. (4) When completed, executions reported on Grouped Orders are allocated in the conditions described in (1). The account Grouped Orders must be left with any opened position nor P&L which must be zero rounded to the fifth decimal. (5) The cash and security balances are checked on a daily basis by the Risk department (6) The appropriate use of the account Grouped Orders is checked quarterly Art. 8 - Monitoring and Review Kepler Cheuvreux will monitor the effectiveness of its order execution arrangements and this Policy on a regular basis. We will also review this Policy at least annually and whenever any material change occurs that affects our ability to continue to obtain the best possible result for our Clients. We will notify you of any material changes to our execution arrangements or this Policy by posting an updated version on Kepler Cheuvreux's website: Art.9 - Best execution proof Kepler Cheuvreux will keep every single event on a client order during a period of 5 years. If needed, Client can ask about its best execution proof. Art.10 - Settlement Agents Cash Equity : PAREL SA (Groupe Société Générale) Fixed Income : DEUTSCHE BANK Amsterdam Derivatives : SOCIETE GENERALE NEWEDGE UK LIMITED 4

5 Art Client acknowledgement & consent We are required to obtain your prior consent to this Policy, the Client will be deemed to have accepted the Policy when it places its first order with Kepler Cheuvreux or otherwise accepts services from Kepler Cheuvreux upon receipt of this Policy. For an instrument admitted to trading on a Regulated Market or MTF, we are also required to obtain your prior express consent before we execute an order in such an instrument outside of a Regulated Market or MTF. Disclaimer This document should not be regarded as legal advice, or an offer to sell or buy any financial product. This document and its contents are proprietary to Kepler Cheuvreux, and no part of this document or its subject matter may be reproduced, disseminated or disclosed without the prior written approval of Kepler Cheuvreux Kepler Cheuvreux. All rights reserved. This policy includes the following attachment: Appendix I: List of Execution Venues 5

6 Appendix I: List of Execution Venues Name Type of venue Membership American Stock Exchange (NYSE) Regulated Market Third Party Broker AQUIS EXCHANGE (UK) Multilateral Trading Facility Kepler Cheuvreux Athens Stock Exchange Regulated Market Third Party Broker Australian Stock Exchange Regulated Market Third Party Broker BATS Dark Multilateral Trading Facility Kepler Cheuvreux BATS Europe Trading Multilateral Trading Facility Kepler Cheuvreux Brazilian Stock Exchange Regulated Market Third Party Broker Bucharest Stock Exchange Regulated Market Third Party Broker Budapest Stock Exchange Regulated Market Third Party Broker Canadian Stock Exchange Regulated Market Third Party Broker CHI-X Delta Multilateral Trading Facility Kepler Cheuvreux CHI-X Europe Multilateral Trading Facility Kepler Cheuvreux Copenhagen Stock Exchange Regulated Market Kepler Cheuvreux Equiduct Regulated Market Kepler Cheuvreux Euronext (Amsterdam) Regulated Market Kepler Cheuvreux Euronext (Brussels) Regulated Market Kepler Cheuvreux Euronext (Lisbon) Regulated Market Kepler Cheuvreux Euronext (London) Regulated Market Kepler Cheuvreux Euronext (Paris) Regulated Market Kepler Cheuvreux Euro TLX Multilateral Trading Facility Third Party Broker Frankfurt Stock Exchange Regulated Market Kepler Cheuvreux SIGMA X MTF Multilateral Trading Facility Kepler Cheuvreux Helsinki Stock Exchange Regulated Market Kepler Cheuvreux Hong Kong Stock Exchange Regulated Market Third Party Broker Indian Stock Exchange (NSE) Regulated Market Third Party Broker Indonesia Stock Exchange (Jakarta SE) Regulated Market Third Party Broker Irish Stock Exchange Regulated Market Third Party Broker Istanbul Stock Exchange Regulated Market Third Party Broker ITG Posit Multilateral Trading Facility Third Party Broker Johannesburg Stock Exchange Regulated Market Third Party Broker Korea Stock Exchange Regulated Market Third Party Broker London Stock Exchange Regulated Market Kepler Cheuvreux Luxembourg Stock Exchange Regulated Market Kepler Cheuvreux Madrid Stock Exchange Regulated Market Kepler Cheuvreux Malaysia Stock Exchange (Bursa Malaysia) Regulated Market Third Party Broker Mexican Stock Exchange Regulated Market Third Party Broker Milan Stock Exchange Regulated Market Kepler Cheuvreux Nasdaq OMX Nordic Regulated Market Kepler Cheuvreux New Zealand Exchange Regulated Market Third Party Broker 6

7 NYSE Bond Match Multilateral Trading Facility Kepler Cheuvreux Osaka Stock Exchange Regulated Market Third Party Broker Oslo Stock Exchange Regulated Market Third Party Broker The Philippine Stock Exchange Regulated Market Third Party Broker Prague Stock Exchange Regulated Market Third Party Broker Shanghai Stock Exchange Regulated Market Third Party Broker Shenzhen Stock Exchange Regulated Market Third Party Broker Singapore Stock Exchange Regulated Market Third Party Broker Six Exchange Regulated Market Kepler Cheuvreux SLS Six Multilateral Trading Facility Kepler Cheuvreux Sofia Stock Exchange Regulated Market Third Party Broker Sri Lanka Stock Exchange (Colombo SE) Regulated Market Third Party Broker Stockholm Stock Exchange Regulated Market Kepler Cheuvreux Taiwan Stock Exchange Regulated Market Third Party Broker Thailand Stock Exchange Regulated Market Third Party Broker Tel-Aviv Stock Exchange Regulated Market Third Party Broker Tokyo Stock Exchange Regulated Market Third Party Broker Turquoise Multilateral Trading Facility Kepler Cheuvreux Turquoise Mid-Point Multilateral Trading Facility Kepler Cheuvreux UBS MTF Multilateral Trading Facility Kepler Cheuvreux Vienna Stock Exchange Regulated Market Third Party Broker Vietnam Stock Exchange (Hanoi SE) Regulated Market Third Party Broker Warsaw Stock Exchange Regulated Market Third Party Broker Xetra Mid-Point Multilateral Trading Facility Kepler Cheuvreux Important note: Access to Kepler Cheuvreux multi-venue execution capabilities for Spanish instruments is restricted to specific clearing and settlement arrangements and may not be available to all clients. Conditions for eligibility are available upon request to Kepler Cheuvreux sales representative. The list of Kepler Cheuvreux third party brokers is available upon client request (send to Information about execution policy of third party brokers is available upon client request (send an to 7