1.1 Under the MAS Notice on Execution of Customers’ orders (SFA 04-N16), Huatai Securities (Singapore) Pte Limited (“HTSG”) is required to establish and implement written policies and procedures (“Best Execution Policy”) which commensurate with the nature, scale and complexity of its business:
i. To place or execute or both, as the case may be, customers’ orders on the best available terms; and
ii. To place or execute or both, as the case may be, comparable customers’ orders in accordance with the time of receipt of such orders.
1.2 This Best Execution Policy sets out the considerations and approach taken by HTSG to provide best execution for its customers.
2.1 Best execution broadly refers to a broker’s duty to place or execute or both, customers’ orders on the best available terms.
2.2 Best execution is applicable when executing customers’ orders directly on an execution venue or placing customers’ orders with another capital markets intermediary or person who is licensed, authorised, regulated, or otherwise exempted in relation to dealing in capital markets products in a foreign jurisdiction, for execution.
2.3 This Best Execution Policy applies to all customers of HTSG.
3.1 To the extent that HTSG follows specific instructions received from a customer, HTSG is deemed to have satisfied its best execution obligations when it places the customer's order in accordance with those instructions and subject to compliance with local regulation. Where the instructions relate to only part of an order, HTSG will continue to apply this Best Execution Policy to those aspects of the order not covered by specific instructions.
4.1 HTSG will ensure that any order is executed in accordance with the Best Execution Policy herein (or will otherwise act in accordance with the best interests of customers when transmitting orders to other persons for execution).
4.2 There may be cases where, as a result of circumstances outside HTSG’s control, it may be appropriate to use an execution method or venue other than one described in this Best Execution Policy. This may be due, for example, to the order size, inadequate liquidity in the security concerned on the relevant exchange, or the availability of an agency cross. In such cases, HTSG will nevertheless take all sufficient steps to obtain the best possible result taking into account the execution factors below, or will otherwise act in accordance with the best interests of customers when transmitting orders to other persons for execution.
5.1 When executing orders on behalf of customers, HTSG will consider a range of execution factors to achieve the best execution terms for its customers. While some execution factors may merit a higher relative importance, there are situations where the relative importance of these factors may change in accordance with the instruction provided by customer or the general broader market conditions.
5.2 The general factors considered are as follows:
i. Price;
ii. Liquidity;
iii. Speed of Execution;
iv. Likelihood of Execution;
v. Costs;
vi. Settlement
vii. Size of the Order; and
viii. Other relevant factors.
5.3 Price will generally merit a high relative importance, but HTSG will take into account the following criteria when determining the relative importance of the execution factors referred to above, such as:
i. the types of customers it serves, whether retail customers or otherwise;
ii. the types of products for which it accepts, places or executes orders;
iii. the characteristics of the execution venues or brokers to which the order can be directed; and
iv. the characteristics of the customer’s orders.
5.4 HTSG will use its reasonable judgment in considering the relevant factors when deciding how to provide best execution.
6.1 HTSG will determine the appropriate execution venue where the customer’s orders can be executed by HTSG, or the appropriate third-party participants or brokers to which the customer’s orders can be transmitted by HTSG for execution.
6.2 HTSG generally applies the following considerations in the selection of execution venues:
i. in the case of equity securities, the primary market on which the issuer’s securities are listed and traded, and
ii. in the case of a warrant or depositary receipt, the exchange of the instrument's primary listing.
6.3 Where a security is listed on more than one trading venue, orders will normally be executed on its primary market, as it is considered that such execution is most likely to achieve consistently the best possible result for customers taking into account the execution factors above and their relative priority.
6.4 For the transmission of customer orders to other brokers, HTSG will use brokers possessing specific and adequate arrangements to satisfy the requirements for best execution. HTSG selects its brokers ba
6.5 At onboarding, brokers are subject to HTSG’s counterparty due diligence checks, which include an evaluation of the following criteria. Brokers are assessed on an annual basis on the following assessment criteria:
i. Financial standing;
ii. Creditworthiness and reputation;
iii. Culture and governance;
iv. AML/CFT checks; and
v. Internal / external audit.
6.6 In addition, HTSG also performs an annual evaluation of brokers’ suitability, ba
i. Cost of execution;
ii. Execution speed;
iii. Trade confirmation;
iv. Likelihood of execution;
v. Manpower/staffing adequacy;
vi. Quality of execution; and
vii. Research support
7.1 Individual orders (including comparable orders) will generally be executed or transmitted sequentially in accordance with their time of receipt and promptly after receipt by the broker.
7.2 For customer orders received outside the normal exchange business hours of the market, HTSG will transmit the order when exchange trading resumes. Customer orders received outside HTSG’s business hours will be handled promptly as soon as HTSG opens.
8.1 HTSG has put in place appropriate governance processes to monitor the compliance with its Best Execution Polices and the effectiveness.
8.2 HTSG monitors the execution of orders to enable HTSG to take proactive steps in delivering best execution.
8.3 HTSG also performs post-execution review on its trade executions on a regular basis.
9.1 HTSG will review the Best Execution Policy on a periodic basis and reserves the right to update this Best Execution Policy as appropriate. Customers will be notified of material changes to the Best Execution Policy by updates on HTSG’s website.
9.2 Customers who require further information on the Best Execution Policy may contact their usual trading representative.