ORDER EXECUTION POLICY 1. Intrductin Trading Pint f Financial Instruments UK Limited, trading under the name XM, is a UK Investment Firm (registratin number 09436004), regulated by the Financial Cnduct Authrity ("FCA") under license number 705428 (hereinafter the Cmpany r XM, we, us and ur )). The Cmpany s registered ffice is at Citypint Building, 1 Rpemaker Street, Lndn, EC2Y 9HT. The purpse f this dcument ( Order Executin Plicy ) is t prvide ur clients with infrmatin abut ur rder executin plicy. This dcument must be read in cnjunctin with ur Client Agreement Terms and Cnditins f Business. Yur Cnsent We are required t btain yur cnsent befre entering a relatinship with yu. By entering int ur Client Agreement/ Terms & Cnditins f Business, yu cnsent and acknwledge that the transactins in financial instruments entered with XM UK are nt cnducted n a recgnised exchange, but instead n ur trading platfrm and, therefre, yu may be expsed t greater risks than when cnducting transactins n a regulated exchange. XM UK may nt execute an rder, r we may change the pening r clsing price f an executed rder in specific cases including but nt limited t instance f a technical failure f the trading platfrm. The client agreement terms and cnditins f business and trading cnditins are established slely by the cunterparty, which is, at all times, XM UK. Yu are then nly allwed t clse an pen psitin in any given financial instrument during ur platfrm s wrking hurs, and yu can nly clse any such psitins with XM UK as yur sle cunterparty. XM UK is required t establish and implement an rder executin plicy and t prvide clients with a cpy f the executin arrangements that XM UK has t cmply with ur duty t give ur clients best executin. In ur dealings with yu, we have a duty t act hnestly, fairly and prfessinally, taking int accunt yur best interest. In relatin t rder executin, XM UK is required t take all reasnable steps t btain the best pssible result when executing client rders r transmitting rders t ther entities t execute. Ptential Cnflicts f Interest A ptential cnflict f interest is that XM UK executes all f its clients rders with its sister cmpany Trading Pint f Financial Instruments Ltd (XM Cy) under a matched principal executin mdel. Under this executin mdel, there is a direct crrelatin between the prfit/lss made by the client and prfit/lss made by XM Cy. XM Cy runs a market making desk and it hedges its expsures n a net bk basis and is the sle executin venue fr XM UK In rder t ensure that the abve ptential cnflict f interest is nt detrimental t the quality f executin ffered by XM UK, XM UK has established prcedures and cntrls in rder t effectively mnitr the quality f executin ffered by XM Cy. Please refer t Sectin 12 f this Plicy fr the prcedures established in this respect. XM UK des nt engage in any direct r indirect trading fr its wn accunt r fr ur wn benefit and therefre ur sle pririty is the trading interest f ur clients. Executin Venue XM UK s single executin venue is prvided by ur sister cmpany XM Cy. XM UK has ultimate respnsibility t ensure it is able t btain n a cnsistent basis the best pssible result fr the executin f its clients rders and t prvide versight ver the activities undertaken by XM Cy n its behalf. XM Cy executes trades in accrdance with XM UK s Order Executin Plicy.
XM Cy is authrised and regulated by the Cyprus Securities and Exchange Cmmissin under the license number 120/10. If yu believe that yur rder has nt been executed in line with this plicy, then yu shuld cntact XM UK at the earliest pprtunity at enquiries@xm.c.uk. 2. Scpe and Services The Plicy applies t retail and prfessinal clients. This Plicy des nt apply t eligible cunterparties. This Plicy applies when executing transactins n clients behalf relating t the Financial Instruments prvided by XM UK. The Financial Instruments prvided by XM UK are derivatives f underlying financial instruments and include: CFD n currency pairs; CFD n Cmmdities CFD n Equity Indices CFD n Single Stcks CFD n Cryptcurrencies All these prducts are leveraged prducts and as such carry a high degree f risk. They are nt apprpriate fr everyne. Yu shuld nt trade with us, unless yu understand the nature f the transactin yu are entering int and the extent f yur ptential lss frm a trade. Yu must satisfy yurself that it is suitable fr yu in the light f yur circumstances, financial resurces and investment bjectives. If yu are in any dubt, yu shuld seek independent advice. Yu trade entirely at yur wn risk. 3. Executin f Client Orders XM UK ffers executin nly trading t its clients by acting as a matched principal brker and ur sister cmpany XM Cy executes all XM UK client rders n ur behalf. XM UK des nt execute client rders thrugh any ther executin venue r cunterparty. XM UK requires XM Cy, thrugh an arm s length service agreement, t implement prcesses and prcedures t evidence that it will deliver best executin in accrdance with this Plicy and regulatry requirements. 4. XM UK s Apprach t Best Executin In rder t meet ur best executin bligatin t ur clients, XM UK takes int accunt the fllwing criteria fr determining the relative imprtance f the executin factrs: the characteristics f the client including the categrisatin f the client as retail r prfessinal; the characteristics f the clients rder; and the characteristics f financial instruments that are the subject f that rder XM UK shall take all reasnable steps t btain the best pssible result fr bth its retail and prfessinal clients taking int accunt the fllwing factrs when executing Clients rders against XM UK s quted prices: a. Price and Overall Cnsideratin f Csts Highest imprtance The main way in which XM UK will ensure that yu btain best executin is by ensuring that the calculatin f ur CFD and frex bid/ask prices reflect the market price fr the underlying reference prduct t which yur transactin relates. XM UK btains its prices frm XM Cy which in turn surces a number f qutes between tp tier liquidity prviders. Our bid/ask prices will generally nt be the same as the cash price fr the underlying asset. In relatin t sme financial instruments, at the time at which yu give us an rder there may be n
functining r n pen market r exchange n which the reference prduct is traded. In such cases XM UK will determine a fair underlying price based n a number f factrs, fr example price mvements n assciated markets and ther market influences, including infrmatin abut XM Cy clients wn rders. Our charges may be incrprated as a mark-up r mark-dwn (the difference between the price at which XM UK takes a matched-principal psitin and the transactin executin price with yu). We may alternatively charge a cmmissin r a cmbinatin f cmmissin and mark-up r markdwn, which will be made clear t the client when placing rders with XM UK. Our charges are nt taken int accunt in determining best executin prices. Bid-Ask Spread a. Bid Ask Spread: Fr any given Financial Instrument XM UK will qute tw prices: the higher price (ASK) at which the client can buy (g lng) that Financial Instrument, and the lwer price (BID) at which the client can sell (g shrt) that Financial Instrument. The difference between the lwer and the higher price f a given Financial Instrument is the spread. Please refer t www.xm.c.uk/spreads fr mre infrmatin. b. Pending Orders: Such rders as Buy Limit, Buy Stp and Stp Lss / Take prfit fr pened shrt psitin are executed at ASK price. Such rders as Sell Limit, Sell Stp and Stp Lss / Take prfit fr pened lng psitin are executed at BID price. c. Price: The price fr a given Financial Instrument is calculated by reference t the price f the relevant underlying financial instrument, which XM UK btains frm XM Cy, which in turn btains it frm external reference surces. XM UK will nt qute any price utside XM UK s peratins time (see Executin Venue abve) therefre n rders can be placed by the client during that time. b. Speed Highest imprtance Due t the levels f vlatility affecting bth price and vlume, we seek t prvide client rders with the fastest executin reasnably pssible, taking int accunt any cnditins relevant t the client rder, althugh delays may ccur. c. Likelihd f Executin Medium imprtance Given the nature f XM UK s executin arrangements, the likelihd f executin is a negligible factr during times f rderly trading. Hwever, in cases f market turmil, likelihd f executin might becme a factr that culd impact the cst f executin by causing a widening f spreads. In such cases, XM UK will aim t strike the best balance between the executin f the client rder and the cst f executin. d. Size f Order Lw imprtance We may place limits n maximum rder sizes frm time t time, and we reserve the right t decline an rder as per ur Client Agreement Terms & Cnditins f Business. We will make every effrt t fill rders irrespective f the vlumes. This hwever, may be achieved at the best available price as per the available market liquidity at the time f executin. 5. Ranking f Executin Factrs The relative ranking f the different executin factrs will be dependent upn, fr example, the nature f the Financial Instrument traded, the liquidity f the relevant market and the time f the trade. The executin factrs will be ranked fr prducts ffered by XM UK as fllws: 1. Price and verall cnsideratin f csts Highest imprtance 2. Speed f executin Highest imprtance 3. Size f rder Lw imprtance CFD n currency pairs XM Cy surces a number f qutes aggregated between tp tier liquidity prviders (and ther reputable liquidity prviders wh aggregate prices received frm tp tier banks) t cnstruct the pricing f XM UK s CFDs n currency pairs. As such, the price that XM UK ffers at any given time is cnsidered t
be ur best and will be autmatically updated n a rlling basis t reflect the best price available at the time f trade fr the size f yur rder. CFD n Cmmdities The price f CFD n Cmmdities is a prprietary price derived by prime liquidity prviders f XM Cy and will generally track that f the relevant underlying exchange traded market. CFD n Indices CFD n Index prices are XM Cy s prime liquidity prviders prprietary prices, which are derived frm the relevant underlying Index price, taking int accunt the cst f carry and liquidity. CFD n Single Stcks The pricing f CFD n Single Stcks prices are XM Cy s liquidity prviders prprietary prices which derived frm the relevant underlying Single Stck price, taking int accunt the cst f carry and liquidity. 6. Executin Venue Executin Venues are the entities with which the rders are placed r t which XM UK transmits rders fr executin. Fr the purpses f rders fr the Financial Instrument prvided by XM UK, XM UK acts as matched principal with the executin venue being ur sister cmpany XM Cy. Opening Hurs Operating hurs: XM UK s peratin hurs are as fllws: a. Rund - the - clck: frm 22.00.01 UK Time (GMT) Sunday thrugh 22.00.00 UK Time (GMT) Friday. b. Nn-wrking perids: frm 22.00.01 UK Time (GMT) Friday thrugh 22.00.00 UK Time (GMT) Sunday. Hlidays will be annunced thrugh the internal mail f the trading terminal supplied by XM UK. Off-exchange transactins: The client acknwledges that the transactins entered in Financial Instruments with XM UK are nt undertaken n a regulated market r a Multilateral Trading Facility, rather they are undertaken thrugh the XM UK s trading platfrm and, accrdingly, they may expse the client t greater risks than regulated exchange transactins. Therefre, XM UK may nt execute an rder, r it may change the pening (clsing) price f an rder in case f any technical failure f the trading platfrm r qute feeds in rder t reflect the prevailing market price at the pening (clsing) f the said rder. Open psitin in any given Financial Instruments can nly be clsed during the pening hurs f XM UK s trading platfrm. Yur agreement t this Plicy shall cnstitute yur prir express cnsent fr us t execute yur rders utside a Trading Venue. Matched principal executin mdel XM UK acts as matched principal with the executin venue being ur sister cmpany XM Cy. Please refer t the belw figure utlining the executin prcess f ur client rders under the matched principal executin mdel. Client Order XM UK Matched Principal Executin XM Cy Nn Dealing Desk Interventin Mdel Price Streaming frm varius Liquidity Prviders
7. Specific Instructin Clients will nly be able t trade using the pre-determined set f rders set ut in Sectin 8 f this Plicy. In this respect, clients will nt be able t specify any ther aspects f their rder. 8. Type f Orders The client is given the ptin t place with XM UK the fllwing rders fr executin in the fllwing ways: The client places a Market Order which is an rder instantly executed against a price that the XM UK has prvided. The client may attach t a market rder a Stp Lss and/r Take Prfit. Stp Lss is an rder t limit Client s lss, whereas Take Prfit is an rder t limit client s prfit. The client places a Pending Order, which is an rder t be executed at a later time at the price that the client specifies. XM UK will mnitr the pending rder and when the price reaches the price specified by the client, the rder will be executed at that price. The fllwing types f pending rders are available: Buy Limit (an rder t purchase a Financial Instrument at r belw a specified price), Buy Stp (an rder t buy a Financial Instrument, which is entered at a price abve the current ffering price; it is triggered when the market price tuches r ges thrugh the buy stp price), Sell Limit (an rder t sell a Financial Instrument at a specified price r better), and Sell Stp (an rder t sell a Financial Instrument when it reaches a certain price). Yu may attach t any Pending Order a Stp Lss and/r Take Prfit. A client may hld up t 200 psitins simultaneusly (cnsidered as summary f Market and Pending Orders ). This requirement applies t the ttal number f psitins held at any given time in all f yur trading accunts held with XM UK. The client may mdify an rder befre it is executed. The client has n right t change r remve Stp Lss, Take Prfit and Pending Orders if the price has reached the level f the rder executin. 9. Miscellaneus Cst Highest imprtance Fr pening a psitin in sme types f Financial Instruments the client may be required t pay cmmissin r financing fees, if applicable, the amunt f which is disclsed in the Spreads and Cnditins n the cmpany s website. a. Cmmissins/Spread: Cmmissins may be charged either in the frm f a percentage f the verall value f the trade r as fixed amunt. Please refer t www.xm.c.uk/spreads fr mre infrmatin. https://www.xm.c.uk/spreads b. Financing Fee: In the case f financing fees, the value f pened psitins in sme types f Financial Instruments is increased r reduced by a daily financing fee swap thrughut the life f the cntract. Financing fees are based n prevailing market interest rates, which may vary ver time. Details f daily financing fees applied are available under Spreads and Cnditins sectin n the XM UK s website. https://www.xm.c.uk/spreads
All types f Financial Instruments ffered by XM UK, the cmmissin and financing fees are nt incrprated int the XM UK s quted price and are instead charged explicitly t the Client accunt. Symmetric Slippage Orders such as Stp Lss, Take Prfit, Buy Limit, Buy Stp, Sell Limit, Sell Stp (market rder) n Financial Instrument cntracts are executed at the specified price by the client n the first current price tuch. But under certain trading cnditins it may be impssible t execute rders (Stp Lss, Take Prfit, Buy Limit, Buy Stp, Sell Limit, Sell Stp) n any Financial Instrument cntract at the specified price. In this case XM UK will execute the rder at the first available price. This may ccur, fr example, in the fllwing cases: a. At the start f a Trading Sessin, b. During highly vlatile markets where prices may mve significantly up r dwn and away frm specified price due t news annuncements and market events c. Where there is a rapid price mvement, if the price rises r falls in ne trading sessin t such an extent that under the rules f the relevant exchange, trading is suspended r restricted, d. If there is insufficient liquidity fr the executin f the specified vlume at the specified price. XM UK strives t prvide the best pssible price t its clients, and makes every effrt and necessary arrangements t d s; hwever it may be impssible t guarantee the executin f any r all f the pending rders at the specified price. XM UK rder executin plicy ensures that whenever slippage applies n an rder this will be symmetric (i.e. may either imprve r wrsen executin price f the rder with an equal prbability and impact). XM UK uses in-huse tls t mnitr slippages n a frequent basis t ensure symmetry and fairness f slippage. XM UK shall prceed t a settlement f all transactins upn executin f such transactins. 10. Aggregatin and Split All rders received are individually executed n a back-t-back basis with ur cunterparty, XM Cy. 11. Quality f Executin Obtainable at Times f Market Stress As indicated earlier in this plicy, XM UK will, at all times, take all reasnable steps t achieve best executin fr ur clients, including during times f market stress. Hwever, sudden lsses in market liquidity r at times f market disrder r the impact f plitical r ecnmic decisins, particularly when they are unfreseeable, can have a severe impact n the quality f executin r even the ability t execute rders itself. This may make it difficult fr XM UK t deliver n a client s traditinal expectatin f the quality f executin that can be expected in nrmal market cnditins. Hwever, XM UK will cntinue, during thse difficult times, t strive t achieve the best executin we can fr ur clients and this may include the aggregatin f client rders in rder t act in the best interests f all clients cncerned. Fiduciary Duty Our cmmitment t prvide yu with best executin des nt mean the we we yu an fiduciary respnsibilities in respect f rder executin ver an abve the specific regulatry bligatins placed upn us r as may be ther cntracted between us. 12. Mnitring and Review f the Executin Plicy XM UK will mnitr n a regular basis the effectiveness f this Plicy and, in particular, its executin arrangements t identify, and where required, crrect any deficiencies.
In additin, XM UK will review the Plicy and its executin arrangements at least annually r when material changes ccur. XM UK will infrm its clients via email and/r thrugh the cmpany s website abut any material changes t its Executin Plicy r rder executin arrangements. Review f the executin quality f XM Cy XM UK will cnduct independent mnitring f the quality f executin prvided by its cunterparty, including: The review f XM Cy s in-huse data mnitring its wn executin against the criteria set in its best executin plicy; The evaluatin f the regular and systematic reviews by XM Cy f the executin venues it utilizes t meet its wn best executin bligatins; The peridic review f the quality f XM Cy executin measured against that f ther cmparable venues. XM Cy uses autmated tls t execute client rders and in this respect XM UK is dependent n XM Cy best executin arrangements. XM Cy is receiving its prices frm varius tp tier financial institutins and aggregates thse prices in rder t prvide t its clients the best available price frm the pl f its liquidity prviders. XM Cy has established cntrls and prcedures in rder t perfrm varius quality checks prir t selecting a financial institutin with which it will wrk with fr btaining liquidity. Particularly, a three stages assessment needs t be fllwed and if ptential financial institutins fail any stage f the assessment XM Cy des nt prceed with the establishment f a business relatinship with that particular financial institutin. In additin t this, XM Cy has develped highly sphisticated in-huse tls which allw XM Cy s frntffice t mnitr its executin arrangements n a real-time basis and receive autmated alerts if any executin factr may negatively affect the cmpany s effrts fr achieving best executin. It shuld be nted that this autmated prcess means that XM Cy persnnel has neither the cntrl ver the selectin f the best available price frm the pl f the liquidity prviders nr can manually intervene in rder t alter any prices streamed t the trading platfrm. By trading with us, yu shall be taken as having agreed t the cntents f this Plicy.