January 2025

 

Purpose of the Policy: 

In accordance with the EU ‘Markets in Financial Instruments Directive II’ (“MiFID II”), Hobart Capital Markets LLP (“Hobart”) is required to take all sufficient steps to obtain the best possible result when executing orders on behalf of its clients (“Best Execution”).

Accordingly, Hobart has in place an ‘Order Execution Policy’, which takes all sufficient steps to ensure the ‘best possible result’ for clients. This policy considers price, size, speed, likelihood of execution and settlement, cost, nature or/any other factor relevant for the execution of a client order from Hobart.

This Order Execution Policy forms an integral part of Hobart’s Terms and Conditions of Business.

 

Venues of Execution: 

Hobart leverages specific electronic trading platforms equipped with access to multiple Smart Order Router’s (SOR’s) to a broad range of markets and venues.  These venues include primary exchanges, Multilateral Trading Facilities (“MTFs”), ‘Dark Pools’ (private asset exchanges designed to provide additional liquidity and anonymity for trading large blocks of securities away from lit venues ) and Systematic Internalisers.  This approach enables Hobart to consistently achieve the best available pricing for its clients at the time of execution.

Access to these venues is facilitated through Direct Market Access (“DMA”) agreements with regulated entities or local brokers, who are equally obligated to ensure Best Execution.  Hobart regularly reviews its DMA providers to ensure access to suitable venues, thereby maintaining compliance with MiFID II requirements and fulfilling client Best Execution obligations.

 

Selection of Execution Venue:

When selecting execution venues, Hobart considers a variety of factors, including:

  • Price:

Price is of paramount importance. Hobart evaluates execution prices against the consolidated best bid/offer or recent prices across eligible venues at the time of execution.

  • Size of Transaction:

The size of a transaction is considered when executing client orders. In some cases, Hobart may execute part of an order if it results in an overall benefit to the client, such as mitigating adverse price impacts for the entire order.

  • Speed of Execution:

To mitigate the risk of adverse price movements in volatile markets, Hobart selects providers with infrastructure that achieves ultra-low latency direct market access. Orders are executed promptly upon receipt to optimize outcomes.

  • Nature / Complexity of Orders:

The complexity of client orders is carefully evaluated, considering market liquidity, venue availability, order size, and any specific limits. In the absence of client instructions, Hobart determines the most suitable trading strategy to minimize market impact.

  • Likelihood of Execution & Settlement:

Hobart utilizes SORs that prioritize access to liquidity pools most likely to facilitate successful execution and settlement.

  • Cost of Execution:

While Hobart endeavors to access the widest range of venues, cost considerations are weighed to ensure they do not outweigh the benefits to the client.

In the absence of specific client instructions, Hobart typically prioritizes Price, Size, and Speed of Execution. Additionally, Hobart may choose to “cross” orders between clients where Best Execution can be achieved.

 

Carrying Out Execution: 

Hobart’s Order Execution Policy is applied through robust electronic systems that integrate SORs and algorithmic trading engines, where appropriate. These systems treat all client orders equally, ensuring non-discriminatory execution and adherence to Best Execution standards.

Client orders are executed by Hobart’s Dealing Team using professional discretion unless specific client instructions or strategies have been agreed upon.

 

Monitoring: 

Hobart conducts ongoing monitoring of the effectiveness of its execution venues, DMA providers, and Order Execution Policy. Any identified deficiencies are promptly addressed.

  • Quarterly Review

DMA providers and execution venues are reviewed at least every three months using a data-driven approach to ensure continued compliance and effectiveness.

  • Daily Monitoring

Hobart reviews the performance of its SORs daily by comparing executed prices against available venue liquidity and pricing.

 

Consents:

In compliance with MiFID II, Hobart requires explicit client consent to trade outside Regulated Markets or Multilateral Trading Facilities. Unless advised otherwise in writing, acceptance of this Order Execution Policy will constitute express consent to trade outside such venues.

 

Reports:

In accordance with RTS 28 of MiFID II, Hobart publishes an annual report detailing its top five execution venues for the preceding year. This report includes data on the quality of transaction execution at each venue and is available on Hobart’s website.