Fairstone Private Wealth Ltd (FPW) is required under Article 3 (1) of RTS 28 to identify the top five execution venues to which it directed its client orders in respect of each class of financial instruments in the reporting year, in order to evaluate the flow of orders and quality of execution.
FPW is an independent MiFID firm with discretionary permissions, offering a range of platform-hosted model portfolios for retail clients. The firm does not have a proprietary dealing desk and does not accept dealing instructions directly from clients.
Orders are transmitted by FPW to the appropriate platform provider. The firms to which FPW directs its client orders are not execution venues in their own right, but route the transactions to other execution venues of their choice. Each platform produces its own RTS 28 report.
FPW is further required under Article 3 (3) of RTS 28 to summarise the outcome of its evaluation of the quality of execution obtained from all of the execution venues to which it has directed orders during the reporting year.
Requirement under Article 3 (3)
Responses by FPW
|a) An explanation of the relative importance the firm gave to the execution factors of price, costs, speed, likelihood of execution or any other consideration including qualitative factors when assessing the quality of execution.||FPW does not place orders directly with an execution venue, but transmits its orders to the platform hosting the investment. FPW performs regular due diligence on its chosen platforms, including an assessment of their order execution policies.
The majority of FPW’s transactions are in open ended, pooled funds which price once a day, meaning that factors such as price, speed, and likelihood of execution are seldom significant. The most material consideration in this case is the availability of funds on the platform.
|b) A description of any close links, conflicts of interests, and common ownerships with respect to any execution venues used to execute orders.||FPW does not have any close links, conflicts of interests or common ownerships with respect to any of its chosen platforms.|
|c) A description of any specific arrangements with any execution venues regarding payments made or received, discounts, rebates or non-monetary benefits received.||FPW does not have any arrangements with its chosen platforms regarding payments made or received, discounts, rebates or non-monetary benefits relating to the execution of orders.
|d) An explanation of the factors that led to a change in the list of execution venues listed in the firm’s execution policy, if such a change occurred.||Platforms may be selected or deselected as a result of periodic due diligence exercises, or the availability of funds on the platform.
Fidelity Funds Network (Financial Administration Services Limited) was added as a platform during 2020.
|e) An explanation of how order execution differs according to client categorisation, where the firm treats categories of clients differently and where it may affect the order execution arrangements.||FPW’s Best Execution Policy applies equally to all its clients.|
|f) An explanation of whether other criteria were given precedence over immediate price and cost when executing retail client orders and how these other criteria were instrumental in delivering the best possible result in terms of the total consideration to the client;||The majority of FPW’s transactions are in open ended, pooled funds which price once a day, meaning that factors such as price, speed, and likelihood of execution are seldom significant. The most material consideration in this case is the availability of funds on the platform.|
|g) An explanation of how the investment firm has used the information acquired under RTS 27.||Not applicable.|