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Best execution: Difference between revisions
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Amwelladmin (talk | contribs) (Created page with "Best execution is a standard imposed by regulators on the execution of traded financial services products by broker-dealers on nehalf of their clients. It will, therefore,...") |
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8. The application or otherwise of {{tag|best execution}} will depend on whether the execution of the client’s order can be seen as truly done on behalf of the client. This is a question of fact in each case and '''ultimately depends on whether the client legitimately relies on the firm to protect his or her interests in relation to the pricing and other elements of the transaction – such as speed or likelihood of execution and settlement – that may be affected by the choices made by the firm when executing the order.''' | 8. The application or otherwise of {{tag|best execution}} will depend on whether the execution of the client’s order can be seen as truly done on behalf of the client. This is a question of fact in each case and '''ultimately depends on whether the client legitimately relies on the firm to protect his or her interests in relation to the pricing and other elements of the transaction – such as speed or likelihood of execution and settlement – that may be affected by the choices made by the firm when executing the order.''' | ||
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====The four-fold test==== | |||
The Commission Opinion sets out a list of the four-fold cumulative test to help determine whether a {{fcaprov|client}} is legitimately relying on the {{fcaprov|firm}}: | |||
{{box| | |||
# '''Initiation''': Which party initiates the transaction; <br> | |||
# '''Market Practice''': Questions of market practice and the existence of a convention to "shop | |||
around"' <br> | |||
# '''Price Transparency''': The relative levels of price transparency within a market; <br> | |||
# '''Available information''': The information provided by the firm and any agreement reached. <br> | |||
}} | |||
=====Initiation===== | |||
=====Market Practice===== | |||
=====Price Transparency===== | |||
=====Available information===== | |||
{{cobsanatomy}} | |||