Best Execution Policy
CXM Trading (hereinafter as “CXM Trading” or “the Firm”) provides mainly automated execution-only services to retail and professional clients (“client”) in the following instruments:
CXM Trading clients place a huge trust with the Firm to offer the best execution to its clients. CXM Trading executes clients’ orders at the best price offered by our credited Liquidity Providers. The system is set to automatically select the best available price and show it to the clients on our online platform. CXM Trading considers ‘price’, ‘cost’ and ‘speed’ as highly important execution factors.
CXM Trading customers can trade using the following trading platform (“platform”):
- MetaTrader 4
- MetaTrader 4 Mobile
Trading is subject to trading hours’ restrictions and are provided per instrument on the platform.
The Firm also operates as an agent whereby client transactions are received and transmitted to other reputable liquidity providers.
CXM Trading provides two-way pricing quoted live across all its products to clients, which can be accessed on CXM Trading’s platform. CXM Trading aims to provide clients with fast, reliable and uninterrupted prices.
To avoid over-reliance on any single provider, CXM Trading receives raw price data for all trading instruments from its Liquidity Providers (“LPs”) and Data Providers such as banks, multilateral trading facilities (MTFs), executing brokers, etc. Each LP is carefully on-boarded, and due diligence is performed by the Risk and Compliance departments to ensure that the LP can offer the best and most reliable possible prices to CXM Trading’s clients. LPs and all data sources are reviewed on an ongoing basis by the Risk department.
The raw pricing data is fed into CXM Trading’s pricing engines, which have the purpose of delivering the platform a smooth and consistent flow of quotes to the client in accordance with the target and average spreads disclosed on CXM Trading’s website.
In the rare circumstances a client is unable to execute trades on the Firm’s system (e.g. due to internet connectivity issues), CXM Trading allows clients to submit instructions via phone or e-mail. When running client instructions over the telephone, CXM Trading aims to quote the price as if the client is trading through the trading platform subject to any delays due to the manual process of trading over the phone/e-mail. CXM Trading confirms the execution of client trades immediately after the client indicates the desired action. If a trade is confirmed by telephone, the client may request a confirmation of the execution in writing.
Spreads and commissions are the critical aspects of the expenses CXM Trading’s clients can incur and CXM Trading always aims to ensure that these are reasonably competitive as compared to other operators in the Forex and CFD markets (e.g. Spreads are continuously monitored by CXM Trading’s Risk department). The costs the client will incur in executing an order with CXM Trading will be related to the spread and commissions. Spreads are dynamic and are dependent on several factors including market liquidity and volatility. Clients are encouraged to fully understand the associated costs prior to transacting with CXM Trading.
Speed, size and likelihood of execution
CXM Trading’s clients receive immediate execution capability, meaning that, if a client sees a price on the screen, in most cases the trade is executed at the displayed price.
CXM Trading’s LPs are ready to absorb trade requests up to the maximum trade size set for each trading instrument. Maximum trade size is available in the contract specifications of each instrument in each trading platform.
CXM Trading determines the maximum size of trade available to clients for each instrument. Regardless of the type of the order, CXM Trading executes any order at VWAP (Volume-Weighted-Average Price) should the size of an order exceed the tradable size at the time of the execution. Depending on the tradable size, CXM Trading’s clients may experience that their orders may be executed at a less favorable price.
However, under all circumstances, CXM Trading pays due regard to ‘slippage’ and passes on positive slippage to clients in case the market moves in favor of them.
Best execution monitoring
CXM Trading is continuously monitoring its ‘prices’ compare to the market through internal monitoring measures and third-party vendor solutions. Prices are monitored around execution time within set thresholds against market price and the underlying instrument.
Where the underlying instruments are traded over the counter (OTC), such as Forex and Metals, the critical factor is the spread. CXM Trading monitors the spread to ensure it sources the most competitive price available. The following parameters are taken into consideration for low, normal and high volatility trading periods latency of price feed, the frequency of price updates, and complete representation of top of the book of orders.
No order aggregation
CXM Trading’s general practice is not to aggregate any client orders with other client orders or any transactions for its account.
Despite ensuring that CXM Trading’s clients receive the best execution, CXM Trading has implemented further measures to ensure that its clients are always protected. CXM Trading also provides that it's systems automatically offer default protections to its clients.
Stop Loss Orders
Clients have the option to trade “stop loss” and “trailing stop loss” orders. This allows clients to autonomously set the level at which they will sell out to limit losses. If the instrument price reaches this level, the position will be closed automatically. Such orders are always connected to an open position or a pending order.
Negative Balance Protection
CXM Trading offers all retail clients negative balance protection. This means that clients will never lose more than their invested capital. For further information, kindly review CXM Trading’s Negative Balance Protection Policy.
CXM continuously monitors its executions to protect its liquidity providers from “toxic flow”, which can be described as the intentional manipulation of orders by a client with the purpose to profit not from the market opportunities, but from the liquidity providers’ execution procedures or by exploiting software technical limitations. In cases where CXM becomes aware of toxic trading patterns, the Firm reserves the right to alter the execution settings for detected accounts which can significantly affect the execution time and price at its sole discretion without any prior notice should the market or liquidity changes require.
Automatic Stop Out
CXM Trading sets minimum margin requirements that result in automatic Stop Out levels to protect clients from losses. If during an open trade, the net worth of the account reaches the “margin level” equal to 30% of the required margins, positions will be closed in order of the largest losing trade until the net equity of the account reached the required margins.
Conflicts of interest disclosure
With regards to its clients, CXM Trading offers the best execution to both retail and professional clients and its automatic execution flow does not differentiate or treat client orders differently. The variation may apply depending on the client risk appetite when compared to another. For example, professional clients may choose to take more risk or higher leverage as compared to retail clients.