Stockbroking & Research

Best Execution Policy – Retail & Wholesale Clients

Argonaut Securities Pty Limited (“Argonaut Securities”) as a market participant of the Australian Securities Exchange (‘ASX’) and Chi-X Australia Pty Ltd (‘Chi-X’) is required under Part 3.8 of the ASIC Market Integrity Rules (“Market Integrity Rules”) to take reasonable steps to obtain the best outcome for its clients when handling and executing client Orders. This policy sets out Argonaut Securities’ approach to providing the best outcome in executing Orders in Equity Market Products in respect of Retail Clients and Wholesale Clients. Equity Market Products has the meaning given to it in the Market Integrity Rules.

For the purposes of this policy, “reasonable steps” means that Argonaut Securities will act in accordance with this policy, given the available resources in order to achieve the best outcome for the client. Argonaut Securities does not guarantee that it will always be able to provide best execution on each and every occasion.

Argonaut Securities may decline to accept any instruction or Order given by you. A reference to an Order in this disclosure is an Order which Argonaut Securities accepts from you.

Best outcome means different things for different clients as delineated below.

Execution Venues

Argonaut Securities may execute or match orders on any of the following trading systems or platforms (“Execution Venues”) that facilitate trading in quoted securities of entities listed on the ASX and/or Chi-X:

  • ASX TradeMatch;
  • ASX Centre Point;
  • Chi-X; and
  • Any other order book offered by the ASX or Chi-X market operators.

For Orders from both Retail Clients and Wholesale Clients, Argonaut Securities will direct the client’s Order to an execution venue or execution venues that satisfies the obligation to take reasonable steps to obtain the best outcome for the client. All Orders will be managed by Argonaut Securities Designated Trading Representatives (DTRs).

Retail Clients

For Retail Clients, best outcome means best total consideration, being the purchase price at which an Order is executed plus transaction costs passed onto the client, or the sale price at which an Order is executed minus transaction costs passed the client. Argonaut Securities will interpret best total consideration solely as the best overall price.

Orders received by Argonaut Securities, will be transmitted to an Execution Venue and will be executed on a price-time priority basis unless a specific instruction to the contrary is received with the Order. If a specific instruction is received and acted on, this may result in the Retail Client not obtaining the best outcome.

Wholesale Clients (including Institutional Clients)

For Wholesale Clients, best outcome will include a consideration of factors relevant to the Client and the instructions given to execute an Order. These include, but are not limited to, price, execution costs, speed, likelihood of execution and settlement, size, nature and any other consideration relevant to the execution of the Order in question. The best outcome for a particular transaction will be determined by the relative importance given by Argonaut Securities to these factors. In determining the relative importance of these factors, Argonaut Securities will take into account the following criteria of the:

  • client’s own characteristics including the categorisation of the client;
  • characteristics of the Order; and
  • characteristics of the Equity Market Products that are the subject of the Order.

Although Argonaut Securities would ordinarily expect price to have a high degree of importance relative to the other factors, its precise importance in the context of any given Order will depend upon the criteria specified above and may also be affected by any specific instructions given by the order giver. For an Order which is large, relative to market volumes, the timing of execution and the market impact of that Order will be a major consideration.

Specific instructions

If Argonaut Securities receives specific instructions from a client about how an Order should be handled, which is inconsistent with obtaining the best total consideration and Argonaut Securities accepts that Order, Argonaut Securities will take reasonable steps to handle and execute that Order in a way which satisfies the instructions. Any specific instruction must be clear and unambiguous. Clients should be aware that a specific instruction may result in the client not obtaining the best outcome. Argonaut Securities reserves the right to refuse any instructions that are unlawful or could give rise to a breach of the market integrity rules.

Where specific instruction relates to only part of the handling and execution process in relation to an Order and Argonaut Securities accepts that instruction, Argonaut Securities will continue to comply with the best execution policy for the remainder of the factors which are not covered by the specific instruction.

For are a Retail Client, any such instruction must be specific to a particular Order.

For a Wholesale Client, any specific instruction may be on an Order by Order basis or may be a standing instruction. A Wholesale Client may also in effect give Argonaut Securities an “opt-out” instruction that Argonaut Securities is not required to use reasonable endeavours to obtain the best outcome when Argonaut Securities handles and executes Orders. Argonaut Securities reserves the right to not accept any standing or “opt-out” instruction from a Wholesale Client. If Argonaut Securities accepts a standing instruction or an “opt-out” instruction, Argonaut Securities will act on that instruction for 12 months, after which a Wholesale Client must give the instruction again if it is to continue to apply.

If Argonaut Securities rejects an Order that is subject to specific instructions, the Order will not be executed by Argonaut Securities. It would be a breach of the Market Integrity Rules for Argonaut Securities to execute the Order ignoring the specific instruction. Accordingly, if the client wishes Argonaut Securities to execute the Order ignoring those specific instructions, the client will need to resubmit the rejected Order without the specific instructions.

Arrangements

Orders received from you will be dealt with fairly and in turn in accordance with Argonaut Securities' internal policies and procedures which comply with Rule 5.1.4 of the ASIC Market Integrity Rules (ASX Market) 2010. This means among other things that:

  • your Orders will be executed in the sequence in which they are received as expeditiously as possible;
  • your Orders take precedence over an Argonaut Securities principal order where there is doubt about the timing of Orders received; and
  • your instructions are never used to your disadvantage.
  • All Orders will be executed through our established electronic systems accessing the ASX’s central limit order book (i.e. ASX TradeMatch & Chi-X).

Systems Failure

If Argonaut Securities experiences a system failure or other circumstance that affects its ability to transmit Orders to an Execution Venue, Argonaut Securities may execute Orders in a manner that differs from the best execution arrangements set out in this policy. Argonaut Securities will make every effort to execute Orders on the best terms available in the relevant circumstances.

April 2018

Stockbroking

Argonaut is licenced in Australia and Hong Kong for stockbroking and corporate finance activities and provides institutional stockbroking services to wholesale, corporate and high net worth clients. As a research driven firm we focus on Metals & Mining, Energy, Agribusiness, Businesses and Contractors that service the natural resource sector and select Industrial companies with market capitalisations between $30 million and $5 billion.

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Research

Argonaut’s research focuses on Metals & Mining, Energy, Agribusiness, Businesses and Contractors that service the natural resource sector and select Industrial companies and where warranted, the research team covers special situations. Our Research Team presently covers over 50 companies and at least a further 50 companies informally. The informal coverage is a valuable component of Argonaut’s research service, given our Perth Office's proximity to the many mining companies based in Western Australia.

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