Delivering Best Execution

for our clients

This Order Execution Policy supplements and should be read together with the Killik & Co Terms and Conditions. Together they form part of the terms of the contract between us. You should read it carefully and let us know if there is anything that you do not understand.
By agreeing to the Killik & Co Terms and Conditions you are also giving your prior consent to this policy and therefore you are already deemed to have accepted its terms at the point we deal (execute) an order for you.


Killik & Co operates this Order Execution Policy in accordance with the requirements of the EU Markets in Financial Instruments Directive II (“MiFID II”) and the rules of our regulator, The Financial Conduct Authority (“FCA”). It means that when making decisions on how to deal your orders, we must take sufficient steps to obtain the best possible result for you.  This document summaries how we do this. You will also find a glossary of useful terms in Appendix 2.

Execution Factors

There are five key factors that we consider when deciding the method and venue on which to execute client orders. Here is a summary:
  • Price: We will usually assume that best price is the most important outcome
  • Size: Small, liquid orders are usually dealt via RSP. Large or illiquid orders are dealt using our dealers’ expertise
  • Order type: ‘At best’ orders are usually dealt via RSP, ‘Limit’ orders are usually published on LSE SETs. If you have specific directions, we will deal according to your instructions
  • Speed: Although achieving the best price is key, sometimes being able to deal immediately may be more important to you
  • Likelihood of settlement: Making sure we choose an appropriate counterparty that can deal with the specific type of order
When considering price, we will take into account the total amount that you will pay, known as the ‘total consideration’. This is represented by the price of the financial instrument and the costs related to execution.

Execution Criteria

As stated above, Price will usually be the most important Execution Factor, but the type of investment instrument may also determine the immediate choice of venue. We will then also use the following criteria to see if another factor should have greater priority for any given trade:
  • Characteristics of the Client : Priorities may be different for Retail or Professional clients, although generally we apply the same policy to both
  • Characteristics of the Order: The size of the order in relation to liquidity, any specific client instructions on execution, or whether a limit has been set
  • Characteristics of the investment: Liquidity, spread, and volatility may mean Speed is prioritised over price, or that another factor takes precedence
  • Characteristics of the Venue: Some venues specialise in particular investment types, e.g. equities or fixed income, and this may influence our decision

Execution Venues

We may execute your order by one, or a combination, of the following methods:
  • Directly on a Regulated Market of which we are a member, e.g. the London Stock Exchange; or
  • With third party investment firms (referred to as Counterparties and/or Market Makers); or
  • Outside a Regulated Market on rare occasions and where we have obtained your prior express consent.
Different venues will be chosen depending on the type of investment you are buying or selling. A list of the venues we use most often for each type of investment is provided at Appendix 1.

Choosing Execution Venues

Where possible, taking into account the Execution Factors above, we will deal your order via the Retail Service Provider (RSP), which provides electronic access to a network of Market Makers. This means that the venue we are most likely to use to execute client orders at normal market size in exchange traded investments such as equities, ETFs, investment trusts, and bonds; is the London Stock Exchange (LSE). For client orders at normal market size in non-UK listed (or ‘foreign’) equities, we will use a third party smart order routing system which provides direct access to international markets.
We regularly assess the Execution Venues available in respect of any investments that we trade to identify those that will enable us, on a consistent basis, to obtain the best possible result for our clients. Whilst a number of new exchanges now exist, analysis of our trade data shows that the LSE has consistently allowed us to obtain the best possible result for the execution of our client orders, when taking account of the factors mentioned above.
For large orders or illiquid investments, we will use the expertise of our dealers to choose the most appropriate venue for your order, again taking into account the Execution Factors. Using a number of different price sources as an initial reference point, our dealers will approach various Counterparties and Market Makers (the main ones are shown in Appendix 1) to try to negotiate a price improvement. Alternatively, an order may be worked via the LSE’s SETS order book.

All Counterparties that we choose to transact with are vetted by the Custodian (our clearing, settlement and custody provider), before any orders can be placed with them. The vetting process looks at their financial position, regulatory status and any negative news. This is reviewed on  an ongoing basis to ensure as far as possible that they will be able to fulfil and complete any orders we place with them, and an up to date list of ‘approved venues’ is maintained.

Execution of orders by our Custodian's Dealers

Between UK market close and close of business, our Custodian’s Dealers provide support to our dealing desk for foreign equity orders which are large in relation to liquidity and require execution by a dealer. Our Custodian’s Dealers execute the order by telephone with a number of counterparties who they consider to be established market leaders in the markets in which they operate. Such orders are executed in accordance with and our acceptance of our Custodian’s best execution policy.

Execution of Fixed Income orders

Fixed Income (bond) orders will either be dealt on exchange through the RSP, LSE ORB, or direct with bond trading counterparties, or alternatively, traded ‘over the counter’ (OTC) direct with specialist bond providers (Reference Apprendix 1). Whether the order is executed ‘on exchange’, or ‘OTC’, is primarily determined by the size and the type of the bond and where that bond is accessible, before consideration is then given to the other execution factors.
Our dealers will check the fairness of the price available to you by gathering market data used in the estimation of the price of the product and by comparing with similar or comparable products. This provides an indication of what the ‘right price’ is for the bond in question, or whether an OTC price offered is ‘fair’. The dealers then select an appropriate venue based on price and availability.

Execution of Collective Investments (Funds)

Orders in Collective Investments, such as Unit Trust and OEICs, will be transmitted to our Custodian’s Dealers and executed in accordance with and our acceptance of our Custodian’s best execution policy. When placing instructions in these types of instruments, our Custodian’s Dealers will either utilise a platform where  multiple  providers  make their products available, or will transact with the provider direct, depending on the specific requirements  of  the product itself. A copy of our Custodian’s order execution policy is available on request.

Trading outside a Regulated Market/ MTF

If the investment instrument you wish to trade is admitted to trading on a Regulated Market (RM) or Multi-lateral Trading Facility (MTF), we will always seek to execute the order through the RM or MTF. We will only execute the order outside an RM or MTF in situations where we consider that it will be in your best interests to do so and we will obtain your prior express consent before we execute that order.

“Limit” Orders

Where we accept a Limit Order from you, in most cases these will be placed on LSE SETS Order Book which means that they are made public. For most orders within ‘normal market size’ this should ensure the most expeditious matching of your order. There may be rare circumstances where we consider that it would not be in your best interests to make your limit order public and in this situation we will discuss the possible outcomes with you (including any additional costs that may be incurred) and ask for your express consent not to make your order public.

Directed Orders

If you give us a specific instruction about the way you would like your order executed, we will carry out the order in accordance with that specific instruction. You should be aware that this may prevent us from taking the steps that we have designed and implemented to obtain the best possible result for our clients.
If you give us an instruction to trade on a specific venue, we may provide you with suggestions for alternatives consistent with our list of approved venues (Reference Appendix 1 for the venues we use most often) and where we reasonably believe the execution of your order on an alternative venue is more likely to achieve the best possible result for you.

Monitoring and Review

We monitor and review the quality of the execution of client orders on a daily and monthly basis. We also keep this policy under review and will update it periodically to make any improvements that we feel are necessary in order to achieve the best results for our clients.

Get in touch

If you would like to talk to us about Best Execution, our team would be delighted to help. To find your nearest branch click here or contact our head office on [email protected] or 020 7337 0777.

Appendix 1.

Execution Venues on which we place most reliance

Appendix 2.

Glossary of terms
  • At Best. An order to buy or sell an investment at the best price available in the market at that time is commonly known as an ‘at best’ order.
  • Counterparty. A counterparty in this context is who Killik & Co transacts with in the execution of an order. A counterparty can also be a ‘Market Maker’ if their business is the generation of market order flow. The ultimate end counterparty to a transaction is also referred to as the ‘execution venue’.
  • Directed Order. Where you give a specific instruction in relation to the way you would like your order executed, this is known as a ‘directed’ order.
  • Limit Order. A Limit Order is an order to buy (buy limit) or sell (sell limit) at a specified price or better.
  • LSE ORB. ORB is the London Stock Exchange’s electronic order book for UK Retail Bonds, including UK Corporate Bonds, UK Supranational Bonds and UK Gilts. Market participants are able to place buy and sell that are organised and displayed by price and size.
  • Multilateral Trading Facility (MTF). An MTF is a multilateral system, operated by an investment firm or market operator, which brings together multiple third-party buying and selling interests in Financial Instruments.
  • OEIC. An open-ended investment company (OEIC) is a type of company or fund, structured to invest in other companies.
  • Order. An order is an instruction from you to buy or sell an investment. The order is ‘dealt’ by Killik & Co by either executing or transmitting to a third party for execution.
  • Over The Counter (OTC). An over the counter (OTC) trade is on that is done directly between two parties, off-exchange.
  • Professional Client. A Professional client is a broader term used to describe a client who is categorised either as a ‘per se professional client’ or an ‘elective professional’ client in accordance with FCA COBS rules.
  • Regulated Market (RM). An RM is a multilateral system operated and/or managed by a market operator, which brings together or facilitates the bringing together of multiple third-party buying and selling interests in financial instruments in a way that results in a contract, in respect of the financial instruments admitted to trading under its rules and/or systems.
  • Retail Service Provider (RSP). The RSP is an electronic trading platform provided by your Custodian, which our Investment Managers (and Dealers) are  given  access  to. The RSP polls quotes from a number of ‘Market Makers’ (consisting of Venues and Counterparties or ‘liquidity providers’, which our Custodian has chosen to connect to based on competitive pricing and financial stability) for the best price currently available in the quantity required.
  • The Stock Exchange Electronic Trading Service (SETS). SETS is the London Stock Exchange’s electronic order book where market participants are able to place buy and sell orders for a specific security that are organised and displayed by price and size.
  • Touch Price. The touch price is a term used to describe the highest bid price or lowest offer price available. The difference between the lowest (offer) and highest (bidding) price is known as the ‘bid-offer spread’.