Best Execution Policy for Wise Assets Europe AS
Last updated: 21 November 2024
1 - Introduction
1.1 - Purpose and Scope
This document applies to Wise Assets Europe AS, all employees of Wise Assets Europe AS or employees of the Wise Group that support the Assets product in Europe. This document should be viewed in light of the current functionality of the Asset Product - namely that it affords customers the ability to purchase units directly in the various UCITS Funds (“Funds”) we offer.
1.2 - Ownership and Review
This document is ultimately owned by Product Compliance, with support from the Wise Assets Europe AS Compliance Officer. The Management Board for Wise Assets Europe AS is responsible for the review and approval of this document. This document will be reviewed on an annual basis, or more frequently as required by a change in business model or product set. Any material changes will be reviewed and approved by the supervisory board.
2 - Overview of Best Execution requirement
MiFID II best execution regime, as implemented in the Securities Market Act, requires Wise Assets Europe AS, referred onwards as Wise Assets, 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. Wise Assets 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 at least once a year and updated if deficiencies become evident. Such a review will also be carried out whenever a material change occurs that affects Wise Assets's ability to continue to obtain the best possible result for their clients. A material change is a significant event that could impact parameters of best execution such as cost, price, speed, likelihood of execution and settlement, size, nature, or any other consideration relevant to the execution of order. During the review, Wise Assets will also assess whether the execution venues chosen by Wise Assets provide for the best possible outcome for our customers. Wise Assets will notify its customers if there are any material changes to these rules.
2.1 - Prompt and Correct Delivery
Where Wise Assets is responsible for overseeing or arranging the settlement of an executed order, it will take all reasonable steps to ensure that any client financial instruments or client funds received in settlement of that executed order are promptly and correctly delivered to the account of the appropriate client.
2.2. - Information relating to Pending Client Orders
Wise Assets must not misuse information relating to pending client orders and will take all reasonable steps to prevent misuse of such information by any of its relevant persons.
2.3 - Client’s Right to Requests
The client can request Wise Assets to demonstrate that the client’s order has been executed in compliance with the Best Execution Policy.
The client can request information about Wise Assets’s policies or arrangements. The requests must be reasonable and proportionate. Wise Assets must answer clearly and within a reasonable time.
2.4 - Order Placement
Due to the way Wise Assets’s service is provided, all orders are placed through the Wise App. Wise Assets does not take trade orders 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 comparing and assessing the results for the client that would be achieved on each of the Execution venues listed, taking into account 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 Wise Assets’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, Wise Assets 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, Wise Assets 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 |
|---|---|
| Unit | Direct with the Fund Manager: Blackrock (Luxembourg) S.A. |
| Unit | 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 Wise Assets 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 Wise Assets 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, Wise Assets 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.
Wise Assets executes orders outside a trading venue. In such cases, you may be exposed to additional risks, including counterparty risk from trading outside a trading venue. Upon client request, we will provide additional information about the consequences of this means of execution.
3.4 - Conflict of Interests/Inducements
Wise Assets 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.
Where Wise Assets applies different fees depending on the execution venue, Wise Assets will explain the differences in sufficient detail in order to allow the client to understand the advantages and disadvantages of the choice of a single execution venue.
Should Wise Assets invite clients to choose an execution venue, fair, clear and not misleading information will be provided to prevent the client from choosing one execution venue rather than another on the sole basis of the price policy applied by Wise Assets.
Wise Assets may receive only third-party payments, including when charging more than one participant in a transaction, that comply with § 852 of the Securities Market Act and will inform clients about inducements that it may receive from the execution venues and the value of any monetary and non-monetary benefits received by Wise Assets. The information specifies the fees charged by Wise Assets to all counterparties involved in the transaction, and where the fees vary depending on the client, the information indicates the maximum fees or range of the fees that may be payable.
The Fund Manager provides Wise Assets Europe AS with a rebate of 0.04% for the funds offered through Wise Interest. Wise Assets Europe AS passes this saving on to the customer through a reduced Wise Assets Europe AS fee.
The Fund Manager provides Wise Assets Europe AS with a rebate of 0.06% for the fund offered through Wise Stocks. Wise Assets Europe AS passes this saving on to the customer through a reduced Wise Assets Europe AS 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 the Commission Delegated Regulation (EU) 2017/565; 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 and part or all of the aggregated order has been filled and the order is only partially executed, it must promptly allocate the designated investments concerned proportionally or in another in a fair and equitable manner if warranted by the specific circumstances of the transaction..
When Wise Assets aggregates a client order with an own account order and the order is only partially executed, Wise Assets shall allocate the related trades to the client in priority to any other account orders. Regardless of whether the order is executed partially or fully, the allocation must not be detrimental to a client.
Aggregation may delay the execution of a transaction, and it may operate to a client’s disadvantage in relation to a particular order.
Otherwise comparable client orders will be executed sequentially and promptly in accordance with the time of their reception for execution by Wise Assets, unless the characteristics of the order or prevailing market conditions make this impracticable, or the interests of the client require otherwise.
4 - Wise Assets’s Aggregation Process
As part of Wise Assets’s 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’s name and will always be a matched position to the aggregate of all of the customers’ orders.
Wise Assets’s position in relation to its customers and its position in relation to the UCITs fund would always remain matched.
Wise Assets’s clients are very unlikely to ever be disadvantaged by the aggregation of orders as there is a single cut off time 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.
5 - Records of Rights and Obligations
Wise Assets retains the records which set out the respective rights and obligations of Wise Assets and the client for at least the duration of the legal relationship related to the provision of investment or ancillary services. These may be in the contract or in the terms of service.
6 - Cancellation and Difficulties
We reserve the right to cancel a transaction without notice where we believe there is sufficient justification. This may include for example (but not limited to) circumstances where we are requested to do so by our counterparty or the relevant exchange.
Wise Assets will inform a client about any material difficulty relevant to the proper carrying out of orders promptly upon becoming aware of the difficulty.
7 - Specific Client Instructions
Wise Assets can take specific instructions from a client which may override this policy however Wise Assets may not induce any client to do so. If a client chooses to give specific instructions to Wise Assets, then Wise Assets will attempt to provide best execution as far as it is possible. However, this may prevent Wise Assets 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.
8 - Providing information to clients on order execution
Following the execution of a transaction on behalf of a client Wise Assets will inform the client of where the order was executed. Please note that we are required to obtain your prior consent to this policy. In addition, the Wise Assets will provide clients a summary of 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).
By selecting to continue, you declare that you have read and understood the above and give consent to this Best Execution Policy. You also consent that we may execute an order outside of a Regulated Market or Multilateral Trading Facility (MTF).