Best Execution & Order Allocation Policy for Wise Assets UK Ltd.
Last updated: 21 November 2024
1. Overview of Best Execution requirement
The FCA’s Conduct of Business sourcebook (COBS), derived from MiFID II Directive (2014/65/EU) and related legislation, requires Wise Assets UK Ltd. (“Wise Assets” or “firm”) to take all sufficient steps to obtain the best possible result for clients, taking into account price, costs, speed, likelihood of execution and settlement, size, nature or any other consideration relevant to the execution of an order. The firm at all times strives to act in accordance with the best interests of its clients when transmitting client orders to other entities for execution.
In order to comply with the overarching best execution requirement (above), Wise Assets will ensure that appropriate execution policies and/or arrangements are effectively implemented for the carrying out of all orders. Wise Assets however is not under an obligation to obtain the best possible result for each individual order; rather we will apply our execution policies to each order with a view to obtaining the best possible result in accordance with the execution policy.
The detailed policy for order execution contained below will be reviewed regularly and clients will be informed of any material changes to the policy.
This policy is intended, in as clear a way as possible, to demonstrate how Wise Assets operates and provides best execution as often as is possible.
2. Order Placement
Due to the way Wise Assets’ service is provided, all orders are placed through the Wise App or website. We are not able to take your order via telephone or email.
3. Order Execution Factors
The decision of which Execution venue is used for any one trade will be reached based on price, costs, speed, likelihood of execution and settlement, size, nature or any other consideration relevant to the execution of an order. This decision may be influenced by the firm’s own fees and commissions. Where there is only one execution venue to place your order, we will be required to use that venue irrespective of the above factors. This is usually the case when you place an order within a collective investment scheme (i.e. Unit Trust or Open Ended Investment Company). This venue will be ‘Direct with Fund Manager’.
When executing an order, the firm will generally treat price and speed as the highest priority for ensuring best execution. Only under exceptional circumstances would this not be the case.
In order to calculate the price, the firm will pay due attention to the ‘total consideration’. This is represented by the price of the financial instrument and the costs related to execution, which must include all expenses incurred by the client which are directly related to the execution of the order, including execution venue fees, clearing and settlement fees and any other fees paid to third parties involved in the execution of the order.
3.1. Execution Venues
An ‘execution venue’ includes a regulated market, a Multilateral Trading Facility (MTF), an Organised Trading Facility (OTF), a systematic internaliser, or a market maker or other liquidity provider or an entity that performs a similar function in a third country to the function performed by any of the foregoing. The below table shows what instruments Wise Assets is involved with and what execution venue is used for each instrument. Orders will be executed outside of a regulated market.
| Instruments | Execution Venues/Clearer |
|---|---|
| Units | Direct with the Fund Manager (Blackrock BlackRock (Luxembourg) S.A) |
| Units | Direct with the Fund Manager (BlackRock Asset Management Ireland Limited) |
Wise Assets believes that the execution venue above is appropriate to providing best execution to you as our service is offering a single venue product. This enables the firm to obtain on a consistent basis the best possible result for the execution of client orders. The charges passed down to the client are consistent with the cost to the firm of dealing with the Fund Manager. As this is a single venue product, there is no discrimination against any one execution venue.
3.2. Execution Criteria
When executing a client order, we will take into account the following criteria for determining the relative importance of the execution factors above:
- the characteristics of the client including the categorisation of the client as a retail client;
- the characteristics of the client order;
- the characteristics of financial instruments that are the subject of that order;
- the characteristics of the execution venue to which that order can be directed
As best execution obligations apply to all financial instruments, irrespective of whether they are traded on trading venues or OTC, the firm will gather relevant market data in order to check whether the OTC price offered for a client is fair and delivers on the best execution obligation.
3.3. Selecting an Execution Venue
As we are only offering a single venue product, all executions will take place directly with the Fund Manager.
3.4. Conflict of Interests/Inducements
The firm 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.
The Fund Manager provides Wise Assets with a rebate of 0.04% for the funds offered through Wise Interest. Wise Assets passes this saving on to the customer through a reduced Wise Assets fee.
The Fund Manager provides Wise Assets with a rebate of 0.06% for the fund offered through Wise Stocks. Wise Assets passes this saving on to the customer through a reduced Wise Assets fee.
3.5. Order Allocation
Wise Assets is required to ensure that all purchases and sales of Units should be allocated fairly across all clients unless there are reasons for acting differently. Subject to COBS 11.3.7A; Wise Assets may aggregate transactions for clients with those of other clients, and will allocate such transactions on a fair and reasonable basis. When Wise Assets aggregates a client order with an order for another client it must do so in accordance with this Policy and ensure that it is consistently applied. Wise Assets will aggregate transactions only where it is unlikely that the aggregation of orders and transactions will work overall to the disadvantage of any client whose order is to be aggregated.
Wise Assets will ensure that the Policy is effectively implemented, providing for the fair allocation of aggregated orders and transactions. When aggregating an order, Wise Assets may execute the order in part if it does not prove possible to execute the order in full. When Wise Assets aggregates a client order with an order for another client, or an own account order, and part or all of the aggregated order has been filled, it must promptly allocate the designated investments concerned in accordance with the Policy.
If the aggregated order is partially executed, Wise Assets shall allocate the related trades to the client in priority to any other account orders. Aggregation may delay the execution of a transaction, and it may operate to a client’s disadvantage in relation to a particular order.
4. Wise Assets’ Aggregation and Position Netting Process
As part of Wise Assets’ execution model, Wise Assets will be routinely aggregating all client buy orders and all client sell orders. The order to the fund will be submitted in Wise Assets’ name and will always be a matched position to the aggregate of all of the customers orders.
Wise Assets may apply ‘position netting’ to client buy and client sell orders in relation to the same fund. Position netting will pair opposing orders for administrative reasons, which could result in a net position; either an ‘open buy order’ or an ‘open sell order’. Position netting will always occur after the trade cut-off time. Wise Assets will always maintain separate internal records of each aggregated buy and sell order.
Open buy order: if on any given trading day Wise Assets receives more client buy orders than client sell orders (i.e. for the same fund), Wise Assets may only submit one buy order to the Fund Manager.
Open sell order: if on any given trading day Wise Assets receives more client sell orders than client buy orders (i.e. for the same fund), Wise Assets may only submit one sell order to the Fund Manager. Wise Assets' position in relation to its customers and its position in relation to the UCITs fund would always remain matched.
Wise Assets' clients are very unlikely to ever be disadvantaged by the aggregation or position netting of orders as there is a single cut off time and single daily price for the UCITs Fund in which Wise Assets will be buying or selling Units. Therefore all clients buying or selling orders on any given trading day would receive the same valuation for their investment regardless of which time an individual client put in a buy or sell order, and regardless if position netting occurred or not.
5. Cancellation
We reserve the right to cancel a transaction without notice where we believe there is sufficient justification. If for operational, legal or regulatory reasons (or any other reason outside of our control) your order cannot be executed on a given trading day Wise Assets shall use its best endeavours to facilitate the execution of that order on the next trading day
6. Specific Client Instructions
The firm can take specific instructions from a client which may override this policy however the firm may not induce any client to do so. If a client chooses to give specific instructions to the firm, then the firm will attempt to provide best execution as far as is possible. However, this may prevent the firm from taking the steps that it has designed and implemented in its execution policy to obtain the best possible result for the execution of those orders in respect of the elements covered by those instructions.
7. Providing information to clients on order execution
Following the execution of a transaction on behalf of a client the firm will inform the client of where the order was executed.
Please note that we are required to obtain your prior consent to this policy.
We are also required to obtain your prior express consent before we execute an order outside of a Regulated Market or Multilateral Trading Facility (MTF) in an instrument admitted to trading on a Regulated Market or MTF. This consent must be in writing or by email.
By selecting to continue, you declare that you have read and understood the above and give consent to this Best Execution & Order Allocation Policy for Wise Assets UK Ltd.