Execution Only
updated:
January 22, 2010
We appreciate that some
people know exactly what they want and do not
require any advice from us.
In such cases we are usually happy to transact the business
on an 'Execution only' basis.
What is Execution
Only?
This is where a transaction is executed by us upon your specific instructions, and where we do not give advice on investments relating to the merits of the transaction.
An 'execution only' transaction is
viewed by the Financial Services Authority as a case
where you have:
(1) Identified the product you
require
(2) Stated the premium you
are willing to pay or the amount you are willing to
invest
(3) Selected the product
provider you wish to do the business with
(4) Selected, if appropriate,
the fund
(5) Selected, if appropriate,
the term of the contract
so that we have not given or offered
to you any advice.
In summary we will not be expected to discuss the suitability of the product with you, that is:
NO ADVICE has been SOUGHT by
you (the client) or GIVEN by us (the
adviser), nor is any advice EXPECTED by
you (the client).
The Advantages of Execution Only
It may be easier for you to transact
'execution only' business with us because we will
not require you to complete a detailed Fact Find. If you are
an exixisting client, however, this may not be an advantage
because you may have already completed a Fact Find within the
last two years which is still acceptable to us.
As there is no requirement to provide advice
to you we will normally reduce our initial commission
entitlement. This will normally either reduce the standard
charges on your investment, or increase the amount actually invested.
If your preferred payment method is by fee, then that will normally
be reduced.
As a general rule we will reduce
our standard initial commission entitlement by
a third to your benefit in such cases where
the investment is less than £20,000, and we will reduce
our standard initial commission entitlement by
half to your benefit in such cases where the
investment is £20,000 or greater. Where
it is not possible to arrange this with the product provider
we will forward a cheque to you in due course for the amount
of commission that we would have sacrificed, once we have received
it.
The Disadvantages of Execution Only
As you would not be receiving advice from us
you may find that there is an important issue concerning
the investment or the product provider that you have overlooked.
You would receive less protection in
the event of a failure of your investment. For example,
you would be unlikely to be successful in a complaint against
us for 'mis-selling'.
If you would like to discuss these issues further
please email us on direct@arch-fp.co.uk or
telephone 0845 3700 661.
Administration of Execution Only
In order to enter into an execution only transaction we will require a written instruction and declaration to this effect from you, preferably in your own hand.
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