1.1 Any capitalised words and phrases in these policies and procedures shall have the meanings given to them in your FX Platform User Agreement. These policies and procedures are the Trading Policies and Procedures to which reference is made in the FX Platform User Agreement.
1.2 These policies and procedures form part of your agreement with Parabellum Markets LLP (PM) to access and use the Platform. By entering into the FX Platform User Agreement, you are agreeing also to comply with and be subject to these policies and procedures.
1.3 These policies and procedures may be amended or varied from time to time by PM in accordance with the FX Platform Agreement.
2. API ACCESS
2.1 All Users who use the application program interface provided by PM (the “API") as the method to access the Platform must (a) keep PM fully informed at all times of the identity of each software program or system that directly or indirectly accesses the API and (b) only provide such access to the API to those software programs and systems that have been previously approved by PM in writing.
2.2 The API offers limited functionality and information compared to the Platform. You should not rely on the API as a means of fulfilling your obligations under the User Agreement and you should not use methods or properties of the API which are not supported.
2.3 Price events sent through the API may be throttled to your external application. The Platform may send events in batches.
2.4 Neither PM nor the Platform will guarantee the delivery of each event generated via the API and cannot guarantee the status of your Orders or Transactions is always up to date. It is your responsibility to obtain up to date information by resubmitting your subscriptions to the relevant API events when a gap in an event batch sequence is detected.
3. ACCESS – GENERAL
3.1 To access the Platform you must use the username and password you specified when you complete your application with PM.
3.2 Be sure that you keep your account details secure. If you believe that your account details have been obtained by any third party you should contact PM immediately.
3.3 PM provides a telephone service to help you with questions on your account and to assist with processing settlement, resolving disputes, sending or receiving Orders or entering into Transactions. Before we accept any instruction relating to your account we will confirm your identity using your username and other security information. We will rely on this information to identify you and you agree that you will not disclose these details to any other person.
4. OBLIGATION OF LIQUIDITY PROVIDERS TO MAINTAIN CONFIDENTIALITY OF TRANSACTIONS
4.1 The following restrictions (in addition to the restrictions set out in the Liquidity Provider’s written agreements with PM) shall apply to Liquidity Providers that act as (i) price provider and (ii) a riskless principal broker and/or prime broker on the Platform:
(a) the Liquidity Provider shall be obligated to keep the identities of all prime brokerage clients confidential. To the extent that a client of a Liquidity Provider's prime brokerage business is trading on the Platform, the identity of that client and all details relating to its trading activities shall not be provided to or made available to any other party, including but not limited to that Liquidity Provider’s own trading desk. For the purposes of these procedures, "identity" means the actual name of the client as well as any information that would allow a reasonably knowledgeable market participant to identify the client by its trading activities and/or style.
(b) Should a client of the Liquidity Provider trade on the price provided by it, the trade will only be identified to the Liquidity Provider as a prime brokerage trade without naming the client or using a 'code name'. Information about any trade executed by the client of the Liquidity Provider with another financial institution on the Platform shall only be made available to the prime brokerage area of the Liquidity Provider (and not to the trading desk of the Liquidity Provider).
5. OFF-MARKET TRANSACTIONS POLICY
5.1 An "Off Market" transaction is the execution on an Order (other than a Stop Loss order) that was entered at a price substantially away from, or inconsistent with, the prevailing market for that currency pair at the time of execution.
5.2 PM may, at its own discretion, review questionable transactions with the intent of preserving the integrity of the marketplace and facilitating a fair and orderly market, pursuant to these policies and procedures.
5.3 A User’s use of the Platform’s trading systems constitutes its executory acceptance of the Platform’s and PM’s right to modify or to cancel transactions in accordance with these policies and procedures.
6. ORDER EXECUTION POLICY
6.1 SCOPE OF POLICY
(a) PM is not required to take any steps to obtain the best possible result (or ‘best execution’) on behalf of you or the Platform’s other users.
(b) The Platform’s systems use proper mapping systems to ensure that prices received from liquidity providers are made available to Users in the order in which such prices were received.
(c) It is in PM’s discretion to decide which spot FX currency pairs shall be made available on the Platform and to enter into agreements with Liquidity Providers to provide streaming prices for those currency pairs.
(d) PM will never be the counterparty to any Transaction.
6.2 NOTIFICATION OF CLEAR ERROR AND RULES APPLICABLE TO ALL OFF-MARKET INQUIRIES AND STOP LOSS ORDER DISPUTES
(a) If a User receives an execution of an order that was entered in error (e.g. in terms of price or quantity), the User may contact PM via e-mail at [firstname.lastname@example.org] or by telephone, at [+44(0)2039601725] and request that the transaction be reviewed pursuant to the Off Market Transactions Policy.
(b) Users should submit requests to review transactions within 20 minutes of execution of such transaction. Requests received after such time period may be reviewed depending on the facts and circumstances surrounding such request, however, PM reserves the right to decline to review any request submitted more than 20 minutes after execution.
(c) PM reserves the right to initiate a review of a transaction, regardless of whether or not a User request has been submitted, if it determines in its sole discretion that circumstances warrant such a review. In such instances, PM may notify Users that a transaction is being reviewed pursuant to the Off Market Transactions Policy.
6.3 EXECUTION AND SETTLEMENT
(a) The Platform routes orders directly to liquidity providers through an electronic execution system. This system requests a quote from a selection of liquidity providers. In conjunction with the price, the Platform quotes available liquidity.
(b) The Platform relies on third party liquidity providers for prices and available volume and transmits orders to these counterparties. Therefore execution of the User’s Orders will depend on the pricing and the available liquidity of the providers.
(c) The Platform is not responsible for the settlement of any Transaction or purported Transaction, although it will use its best endeavours to assist the parties to the Transaction in effecting settlement.
6.4 ADJUDICATING TRANSACTIONS
(a) If PM determines that a transaction was Off-Market, PM will use its good faith efforts to contact each of the participating financial institution (s)/client(s) party to the Off-Market Transaction. PM will reasonably review the data available to it to determine where the "correct" price for the applicable currency pair was at the time of the Off Market transaction. PM will use its good faith efforts to assist the parties to the Off Market Transaction to arrive at a resolution which is reasonably acceptable to those parties and to PM. Possible resolutions include, but are not limited to, an adjustment of the rate or voiding the Off-Market Transaction entirely.
(b) PM will use commercially reasonable efforts to preserve the anonymity of the parties to the Off-Market Transaction from each other during the period in which it is attempting to assist those parties to come to arrive at a resolution.
(c) In the event that after a reasonable period of time (generally not to exceed 60 minutes), the parties to the Off-Market Transaction cannot agree on resolution, or if PM is unable to reach one or more of the parties to the Off-Market Transaction during such period of time, PM reserves the right to act unilaterally to void the Off-Market Transaction or to modify one or more terms of the Off-Market Transaction.
(d) A final determination generally will be made quickly, typically within an hour of a request being submitted. PM will provide written notification via e-mail and may also provide oral notification of a determination to the parties involved in a disputed transaction.
(e) Each request will be considered on a case-by-case basis.
This statement outlines the Firm’s position with respect to the UK Stewardship Code (the “Code”), which was published by the Financial Reporting Council (“FRC”) in July 2010 and amended in September 2012. Under Rule 2.2.3R of the FCA’s Conduct of Business Sourcebook, the Firm is required to make a public disclosure about the nature of its commitment and level of compliance to the Code or, where it does not commit to the Code, to explain its alternative investment strategy.
The Code is a voluntary code, which aims to enhance the quality of engagement between asset managers and listed companies in the UK, to help improve long-term risk-adjusted returns to shareholders and the efficient exercise of governance responsibilities. It sets out good practice on engagement with investee companies and is to be applied by firms on a “comply or explain” basis. It also describes steps that asset owners can take to protect and enhance the value that accrues to the ultimate beneficiary.
The FRC recognises that not all parts of the Code will be relevant to all institutional investors and that smaller institutions may judge some of the principles and guidance to be disproportionate. It is of course legitimate for some asset managers not to engage with companies, depending on their investment strategy.
The seven principles of the Code provide that, so as to protect and enhance the value that accrues to the ultimate beneficiary, institutional investors should:
· Publicly disclose their policy on how they will discharge their stewardship responsibilities;
· Have a robust policy on managing conflicts of interest in relation to stewardship which should be publicly disclosed;
· Monitor their investee companies;
· Establish clear guidelines on when and how they will escalate their stewardship activities;
· Be willing to act collectively with other investors where appropriate;
· Have a clear policy on voting and disclosure of voting activity; and
· Report periodically on their stewardship and voting activities.
2. THE FIRM’S POSITION ON THE CODE
It should be noted that given the Firm’s specialist focus on Spot FX only the number of occasions on which the Firm will be involved in UK equity investments, will be limited. Therefore, the Code’s relevance has limited applicability to the Firm’s investment activities.
The Firm has chosen not to formally commit to the Code given the nature of the Firm’s asset base and its investment approach.
This Statement is reviewed annually and updated where necessary to reflect changes in circumstances and actual practice. Should the Firm’s position change we will review our commitment to the Code and make appropriate disclosure at that time.
For further details on any of the above information please contact the Firm’s Compliance Officer.