Quality of Execution Report 2017

A. Overview

Brewin Dolphin (‘the firm’) has an obligation to take all sufficient steps to obtain the best possible result when transmitting, placing and executing orders on behalf of clients on a consistent basis (‘Best Execution’). The firm has established an Order Execution Policy (‘the Policy’) that sets out the steps that the firm takes to achieve Best Execution for its clients. The Policy can be accessed on the following link on the firm’s website Order Execution Policy. Section 4 of the Policy also contains the Execution Factors and the relative importance of these factors that the firm takes into account to achieve Best Execution for clients.

Under MiFID II1, the firm is required to publish annually for each class of financial instruments the top five execution venues in terms of trading volumes and a summary of the quality of execution obtained on these execution venues.

The purpose of this document is to comply with this requirement and to provide clients with sufficient information to effectively allow for comparison between different firms and also to enable comparison of performance over time.

For the purpose of achieving Best Execution, the firm treats all clients (Retail and Professional) as Retail. This means that the firm undertakes to provide the highest protection to its clients regardless of client classification.

B. Monitoring Approach

The firm performs monitoring to ensure the effectiveness of the firm’s order execution arrangements which is set out below.

Daily monitoring of transactions;
Due diligence of counterparties;
Annual review (or more frequent, if there is any material change) of the Policy and related client disclosures in respect of Best Execution;
Annual assessment of the firm’s order execution arrangements.

The firm uses an industry leading third-party vendor (LiquidMetrix which is an expert in execution quality assessment and transaction cost analysis) to benchmark2 the firm’s transactions against venues available. The firm has set a tolerance that would trigger a review of the transaction.  Any transaction with a price that is outside the tolerance set, is investigated.

The results of monitoring are presented to the members of the Order Execution Policy Committee (OEPC), which meet on a monthly basis and is the governance forum that oversees the order execution arrangements of the firm.

In addition, the firm has policies and procedures to ensure any potential conflict of interest is managed appropriately. During the period from 1 January to 31 December 2017, nothing has come to the attention of the OEPC that would indicate any conflicts of interests pertaining to the firm’s counterparties/execution venues.

C. Summary of the 2017 Monitoring results

All the firm’s transactions from 1 January to 31 December 2017 have been monitored to ensure that Best Execution was achieved. Overall, 99.9937% achieved Best Execution. The transactions that did not achieve Best Execution have been reviewed and clients have been reimbursed in accordance with the firm’s procedures. 

[1] The Markets in Financial Instruments Directive (MiFID) II is a set of regulations which aims to improve the way firms comply with regulations in order to strengthen protection of investors.

[2] Benchmark means comparing the firm’s transactions, particularly the price achieved on each of the trades, against the prices that would have been achieved in other execution venues.