Disclaimer
This Best Execution Policy describes the procedures undertaken by the Equity Sales Trading Department (“Equity Sales Trading”) of SBI Securities (Hong Kong) Limited (“SBI HK”) when executing orders on behalf of clients (“Client”) serviced by SBI HK Equity Sales Trading.
This Best Execution Policy is not intended to create a legally binding obligation and should instead be read as a statement of intention when executing orders.
This Best Execution Policy should not be taken as a representation and failure to comply with these procedures should in no way, of itself, mean that SBI HK has breached any client obligation.
SBI HK’s commitment to provide “best execution” does not mean that it owes any of its Clients any fiduciary responsibilities over and above any specific regulatory obligations placed upon it, or as contractually agreed with the Client.
SBI reserves the right to amend its Best Execution Policy at its sole discretion and without providing notice. Updated versions will be made available via SBI HK’s website.
This Best Execution Policy does not represent legal advice and should be read in the context of any prevailing Client agreements, local law, and applicable market rules and regulations.
Purpose
SBI HK is authorized and regulated by the Securities and Futures Commission of Hong Kong (the “SFC”) and is a licensed corporation for Type 1 (dealing in securities) and Type 4 (advising on securities). SBI HK is subject to the Code of Conduct for Persons Licensed by or Registered with the Securities and Futures Commission (“Code of Conduct”).
The Code of Conduct requires licensed persons, when acting for or with clients, to execute client orders on the best available terms.
SBI HK executes orders in relation to Japanese cash equities on behalf of Clients. There are two methods that it can use to execute orders.
First, SBI HK can execute the relevant transaction on behalf of the Client directly with a counterparty (which could include an affiliate) or an exchange. The counterparty, exchange with which SBI HK chooses to execute such a transaction is referred to in this policy as an “execution venue”.
Secondly, SBI HK can place an order as an agent or as a riskless principal with an affiliate, a third party (e.g. another broker or investment bank) and / or any affiliates of that third party to execute on behalf of the Client. Such entities are referred to in this policy as “Brokers”.
SBI HK will execute through affiliates wherever possible unless the Client specifies otherwise. Where SBI HK executes transactions with an affiliate or a third party acting as an execution venue or where SBI HK transmits orders to an affiliate or a third party, SBI HK will satisfy the Best Execution Policy by undertaking due diligence.
This document summarizes the Best Execution Policy of SBI HK Equity Sales Trading in relation to agency and riskless principal orders executed on behalf of Clients. SBI HK has established and implemented a framework of Policies and Procedures which are designed to take all reasonable steps to deliver a Client the best available terms on a consistent basis when executing orders on the Client’s behalf.
Scope
When SBI HK enters into agency or riskless principal transactions with clients, the obligation to deliver best execution remains with SBI HK where clients rely on SBI HK to protect their interests in order execution.
The Best Execution Policy will not apply where there is no expectation on SBI HK to provide a best execution service. Such situations typically occur when:
The client elects to control and execute its own orders via SBI HK’s electronic trading platform.
Client Specific Instructions
Clients may instruct SBI HK to follow specific instructions. Where the Client provides specific instructions, SBI HK will take reasonable steps to execute the orders in accordance with such instructions.
Where the Client specifies execution instructions these may conflict with, and therefore prevent SBI HK from taking steps it has designed and implemented in this Policy to obtain the best possible execution result for those orders.
Where a client’s specific instructions only relate to part of an order, this policy will apply to those aspects of the order not covered by the specific instructions.
In following Client instructions SBI HK will be deemed to have taken all reasonable steps to provide the best outcome. In such circumstances SBI HK shall consider its duty of best execution under this policy to be satisfied.
Best Execution
In the absence of Client specific instructions, SBI HK will exercise its own discretion and will take into consideration a range of execution factors and characteristics. SBI HK will take into account the following range of execution factors: price, speed, likelihood of execution, speed and likelihood of settlement, size, cost, nature of the order, liquidity of the market, potential price impact, characteristics of the client, the order, the financial instrument and the execution venue and any other relevant factors.
There is no guarantee that best execution will be achieved in all circumstances and, in any event, the execution factors and characteristics that SBI HK considers in pursuit of best execution may lead to different results to the same order executed at different times.
Execution Venue
It may be possible to execute and / or report transactions and crossings through various execution venues. In meeting its obligation to take all reasonable steps to consistently obtain the best outcome for the Client, SBI HK may execute or report orders at the following venues: a regulated exchange, alternative liquidity platforms (subject to Client consent); or a cross reporting platforms where an order has been crossed with opposing SBI HK client orders (subject to Client consent).
Review and Monitoring
SBI HK will monitor the effectiveness of its order execution arrangements on a regular basis in order to identify any issues that may affect its ability to continue to obtain the best outcome for the execution of Client orders on a consistent basis using the venues stated in this Best Execution Policy.
SBI HK will review its order execution arrangements and will notify Clients of any material changes to its order execution arrangements. Equity Sales Trading Department together with Compliance Department will review this Best Execution Policy at least annually and will notify any changes / updates of this Policy by posting the information on its website.
Revision History
| Version | Date | Changes |
| 1.0 | February 2019 | Implementation of Best Execution Policy |
| 1.1 | November 2019 | Minor revisions |
| 1.2 | May 2024 | Minor revisions |