SPREADEX

ORDER EXECUTION POLICY

 

Spreadex Limited is Authorised and Regulated by the FCA in respect of its spread betting and CFD business. In accordance with the requirements of our regulator, we have implemented a number of steps designed to enable our clients to get the best possible outcome when they enter into spread bets with us.

Financial Spread Bets and CFDs

We have established and implemented arrangements which we believe will provide you with the best result when you spread bet with us.

Spread bets are bilateral contracts between two principals. When you spread bet with us, we will be the only execution venue available to you and our price will be the only price. However, financial spread betting has been designed as a means of speculating on the underlying financial markets. We have therefore made arrangements designed to ensure that our prices reflect the prices available to us in the underlying market having regard to our regulators requirements on best execution.

Execution Factors

We consider a number of factors in deciding how to execute client orders:

Overall cost: Unless we agree otherwise with you, we will proceed on the basis that the most important factor to you is the overall cost of your transaction. We will seek to base our price on the most cost-effective hedging markets available to us. Our spread is based upon the underlying market and we would take the mid-point of the underlying market as the mid-point of our spread thus ensuring that we are providing the most favourable execution terms on both the bid and offer.

Speed of execution: Our service is designed to facilitate short term trading. Unless we agree otherwise with you, we will not delay execution of your order in the hope of a change in market conditions. We will base our prices only on the prices which are immediately available to us.

Liquidity: Unless it is inconsistent with obtaining the best overall cost without delay, we will base our prices on the contract/venue with the best liquidity for the market in question.

Execution Venues

In respect of spread bets and CFDs, we will seek to manage our risk as a market maker. In doing so, we might choose whether to hedge all or part of your trade(s) in the underlying market(s). It is our belief that this approach is likely to result in reduced execution costs and market price impact for our clients overall. Where Spreadex determine that hedging in the underlying market is required the price of the contract that Spreadex enters into with you may be affected, as the price offered shall take into account the prevailing market prices available to Spreadex.

Spreadex key Execution Venues are:

  • Morgan Stanley
  • Cantor Fitzgerald
  • IG Index
  • ADM
  • Killik & Co
  • Patronus Partners

Details of our selected price source for each contract can be found on our market information pages.

Specific Instructions

If we accept specific instructions from you in relation to any order, we will give priority to those instructions when executing your order. This may prevent us from taking the steps that we have designed and implemented in our execution policy to obtain the best possible result for the execution of those orders in respect of the elements covered by those instructions.

You should also note that the spreads we disclose on our market information pages reflect the costs we incur in managing risk at our selected venue. If you give us specific instructions which require us to manage the risk on a particular trade in a different way, the spreads applicable may vary. We will provide you with any relevant details before accepting your order.

You have the ability to adjust the tolerance thresholds when placing a trade, which will dictate the likelihood of a trade being successfully executed or rejected. You are also able to adjust your preferences as to whether or not you wish to accept partial fills. Spreadex shall only ever partially fill an order as an alternative to an outright rejection of a trade.

Spreadex operates a tiered spreads system whereby our spreads will widen proportionately as trade sizes increase. This reflects the underlying liquidity and is intended to maximise the chance of your trade being accepted.

Basis Adjustments and trading outside market hours

The main way in which we will ensure that you obtain best execution is by ensuring that in the calculation of our bid/offer prices used to execute your Contracts, we pay due regard to the market price for the underlying reference product to which your Contract relates. We have access to a number of different data sources in order to ascertain the market price, which is our objective view of the bids and offers available to arms’ length traders.  In relation to some financial instruments, at the time at which you give us an order there may be no functioning or open market or exchange on which the reference product is traded. In such cases, we set out to determine a fair underlying two-way price based on a number of factors such as price movements on associated markets, other market influences and client trading flow.

Limitation

We act as true principal for our own account at all times. We will not owe you any responsibility beyond what is required under the rules of our regulator.

CONFLICTS OF INTEREST

Spreadex will not receive any remuneration, discount or non-monetary benefit for routing client orders to a particular trading venue or execution venue which would infringe the requirements on conflicts of interests (as set out in SYSC 10) or inducements as set out in COBS 2.3. 

The Spreadex Conflicts of Interest Policy can be found at Conflict Of Interest Policy | Terms and Agreements | Spreadex

RETAIL AND PROFESSIONAL CUSTOMERS

Most of our clients are categorised as ‘Retail Customers’. However, some of our clients have asked us to categorise them as ‘Elective Professional Customers’ so that they can have access to higher levels of leverage and/or credit facilities.

When we execute client orders, we follow the same process irrespective of the categorisation of the client.

MONITORING OUR EXECUTION

Spreadex will monitor the effectiveness of our order execution policy. We maintain relationships with the leading global exchanges and OTC pricing providers for our price feeds as well as leading data vendors to deliver our prices from exchange to our platform. In addition we use global execution venues to provide liquidity. We regularly review all such relationships with a view to ensuring that you get the best possible outcome when you trade with us.

We will review our order execution arrangements on an ongoing basis and update this policy whenever a material change occurs.