Common use of Execution Factors Clause in Contracts

Execution Factors. Subject to any specific instructions that we receive, we take into account a range of factors in deciding where to execute deals in order to obtain the best possible result for our clients. Our dealers and portfolio managers who place deals (referred to for this purpose collectively as dealers) will determine the relative importance of a range of sometimes conflicting factors by using their experience in the particular financial instruments and markets being traded. Generally, and specifically in the case of Retail clients, the most important factor that the dealers take into account is the price of the financial instrument being traded, along with any associated execution costs - the total consideration for the trade. The diversity of the markets, the types of instruments we trade and the kind of orders we place means that we often take into account a variety of factors in addition to the total consideration of the trade. These other factors may include speed, likelihood of execution and settlement, the size and nature of the order, market impact and any other consideration relevant to the execution of a particular order. In some markets, price volatility may mean that the timeliness of execution is a key factor, whereas in other markets or instruments that have low liquidity, it may be the mere ability to execute the trade that is a key factor. In other cases, our choice of venue may be limited (even to the fact that there may only be one platform/ market upon which we can execute orders) because of the nature of the trade. For some types of financial instruments such as over-the-counter transactions there is no formalised market or settlement infrastructure, which is particularly relevant for certain fixed income and derivative trades.