High Risk Investment Warning
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 74% of retail investor accounts lose money when trading CFDs. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
BuzzFx (hereinafter as “BuzzFx”)
BuzzFx provides contracts for differences (CFDs) to its clients covering a wide variety of financial markets and instruments. Every market quoted by BuzzFx is derived directly from an underlying financial instrument sourced from an exchange or from a wholesale quoting counterparty (i.e. FX Liquidity Providers). BuzzFx decides which markets to quote, the times at which those markets are quoted and BuzzFx publishes via its trading platforms those quotes on which clients may be able to trade.
At times the underlying financial instrument on which BuzzFx derives its quotes may not have a functioning or open market or exchange. In such cases, BuzzFx will determine a fair two-way price based on various factors such as price action on other correlated markets that are open at that time, client trading flow, news releases and other market influences.
BuzzFx is the counterparty (or ‘principal’) to every trade. This means that you must open and close each and every trade with BuzzFx and cannot close an open trade made with BuzzFx with a third party (i.e. a different CFD or spread betting provider) and vice versa.
BuzzFx is a regulated entity and, as a regulated entity, BuzzFx is required to take all sufficient steps to ensure the best possible result when executing client instructions.
Order Execution Policy
Any system failure at BuzzFx may result into not executing the order according to the client instructions or not executing the order at all.
Swaps values may be adjusted daily based on market conditions and rates provided by liquidity Providers also applicable to all open positions. Triple swaps are applied every Wednesday.
Server Times: Winter: GMT and Summer: GMT+1 (DST) (last Sunday of March and ends last Sunday of October).
During the time period from 23:55 to 00:05 server time increased spreads and decreased liquidity can take place due to daily bank rollover. In case of inadequate liquidity/spreads during bank rollover, widened spreads and excessive slippage may occur. Therefore orders may not be executed during these times.
BuzzFx reserves the right to cancel and/or delete any transaction/pending order executed on an invalid price without prior notice. Market spreads is offered on all selected products.
BuzzFx may in its soul and absolute discretion, at any time, without a prior notice change its commissions, fees, spreads, margin requirements and leverages, or close any account.
When BuzzFx opens and closes transactions for you, it will take all sufficient steps to achieve the best possible result for you by opening and closing those transactions according to our Order Execution Policy and subject to any specific instructions received from you. In all other circumstances, when BuzzFx executes a transaction or order for you it will take into consideration a number of factors that allow it to offer the best possible result. For both retail and professional clients, this will be primarily determined by the total consideration, representing the price of the financial instrument and the costs (spread or commission) related to the execution. In addition, depending on the type of order provided, such as ‘Market Orders’ or ‘Stop loss orders’ BuzzFx will consider the speed of execution, when assessing how to achieve the best possible result.
In determining the importance given to other factors BuzzFx will exercise its commercial judgement in assessing other factors impacting the likelihood of execution and settlement, such as, the size and nature of the transaction or order, liquidity in the underlying market and the availability of price improvement, in order to obtain the best result for the client. For example, BuzzFx may prioritize such other factors where there is insufficient immediately available liquidity to execute an order in full, where we are instructed to work an order over a period of time or by reference to a benchmark calculated over a period of time or where we determine that there are other circumstances such that obtaining the best immediately available price may not be the best possible result for a client.
In addition, in the case of a ‘Market Order’ placed on an instrument where there is insufficient liquidity available to fill the order in full without materially impacting the price of the underlying market, then BuzzFx may prioritize attaining the best possible price of the order rather than taking that which is immediately available and may therefore ‘work’ the order over a period of time as deemed appropriate given the size and nature of the order.
Conversely, BuzzFx may determine that the speed and likelihood of execution of execution and settlement should take precedence over price if required to ensure the best possible result. Such as case could be in a volatile product that is illiquid and has fallen sharply triggering a ‘Stop loss order’.
Price and Costs
One of the main ways BuzzFx ensures that its clients obtain the best execution is by paying due regard to the underlying market price of the related instrument on which BuzzFx derives its bid/offer quotes and uses to execute client transactions. BuzzFx utilize a number of different data sources to ascertain the market price which is determined on the best bids, best offers and liquidity.mb-30
With some financial instruments, there may be times where a client sends a transaction request at a time when there is no functioning or open market or exchange on which the reference product is traded. In such cases, BuzzFx sets out to determine a fair market price based on a number of factors, for example, price movements on associated markets and other market influences, including information about flow received from BuzzFx’s clients.
If you place an order via the trading platform, and it is accepted then assuming there is no ‘price error’ and subject to having sufficient available margin resource, your transaction will be executed in accordance with the order type sent:
- Instant Order; the order will be filled at the price requested by you or better if an improvement is available.
- Market Order; the will be filled at the prevailing market price once we have received your order.
If your order is made over the telephone then, assuming there is no ‘price error’, your transaction will be executed at the price quoted and confirmed by the dealers or as per the instructions left by you. For our pricing policy please see clause 6.
All costs associated with any execution as added by BuzzFx are detailed within the Markets section of our website and are not dependent on any priority criteria chosen by BuzzFx or execution method or venue, such as executing a hedge versus retaining the principal risk. More information regarding our costs (spreads) can be found in our Market Information pages via the website.
Whether or not BuzzFx hedges its principal exposure in the market, the speed with which the trade is executed, whilst also being mindful of price, is of high importance. Where clients request to trade using a ‘market order’, specifying direction and size only, then BuzzFx may prioritize speed above that of price. This will be assessed with reference to market conditions, taking consideration of the liquidity of the market, size of the order, availability of price improvement and the potential impact on total consideration. This may be the case for a large order on an illiquid instrument when a ‘stop loss order’ has been activated.
Transaction Size and Nature
All transaction execution is subject to size considerations. If the requested transaction size is larger than BuzzFx is able to trade in the ‘underlying market’ on the relevant exchange at that time then the entire transaction or order may be rejected but BuzzFx may offer greater liquidity than the ‘underlying market’ at its discretion. Every market quoted by BuzzFx has an absolute minimum permitted and this can be found by clicking on the information icon button associated with each market. The maximum transaction size may vary due to market conditions and is, at all times, at the discretion of the BuzzFx dealers.
In the event of a transaction request of unusual size or where the market in which the transaction has been requested is illiquid or very volatile BuzzFx may prioritize price over speed of execution and may, at its sole discretion, only accept the transaction after BuzzFx has covered the exposure in the underlying market.
Likelihood of Execution and Settlement
In almost all circumstances, so long as you have sufficient margin available on your account for the transaction and so long as the transaction size requested is equal to or under size permissible in the ‘underlying market’ at that time, your transaction will be executed automatically at the level requested or prevailing market level in case of a ‘market’ order request. Where a transaction request exceeds certain size parameters as determined by BuzzFx and based on typical liquidity in the underlying instrument, BuzzFx may prioritize the likelihood of execution and settlement over speed and refer the request to BuzzFx’s dealers for confirmation.
In certain circumstances due to speed of internet communications, market volatility or in the case of deliberate manipulation of BuzzFx quoted prices a transaction request may be rejected if the price requested to enter into a transaction is not representative of the ‘underlying market’ price when received by BuzzFx.
On rare occasions BuzzFx may provide a partial fill of a transaction request as an alternative to an outright rejection, BuzzFx will not provide a partial fill as an alternative to filling it in its entirety.
BuzzFx assesses each execution venue that it has access to when determining the pricing and hedging of client transactions. BuzzFx will always act in principal in respect of client transactions, and therefore may seek to act as market maker and may choose whether to hedge any/part or all of the risk in the underlying market for all account types. Where an order is ‘worked’, see section 5, BuzzFx will use the hedged execution price of the related instrument as reference to the underlying market price on which BuzzFx derives its quotes to execute the client transaction.
Trades and Orders
There are three types of instructions that our clients may give to execute or initiate a transaction with BuzzFx.
Transaction - This is where you give an immediate instruction to buy or sell on a currently quoted price. However, if the request is for an at ‘Market’ transaction then this is where you give an immediate instruction to buy or sell on the prevailing market price.
Order (Standing Order) - This is where you give an instruction to execute a transaction at a price that is not currently available in the market but may be available at a future date/time.
Working Order - In certain cases when the transaction size is greater than the ‘underlying market’ size or where the ‘underlying market’ is illiquid (i.e. in certain AIM or small cap stocks) or where BuzzFx may for various reasons attempt to work an order for the client in the market at a certain price then BuzzFx will agree a corresponding single trade price for the whole position after completion of the ‘underlying market’ trade.
In instances where a client enters into a transaction in unusually large transaction sizes, or where the client specifically requests, BuzzFx may at its sole discretion place the orders directly into the ‘underlying market’ using BuzzFx’s own name to execute the transaction. BuzzFx will only ‘work’ two types of orders for clients, ‘Single Price’ orders and ‘Market Orders’ and such orders will only be ‘good for the day’. ‘Single Price’ orders are where the entire ‘underlying market’ order is made at an agreed pre-determined price and no other (i.e. to sell if the market reaches a certain point and to just offer at that price). Such an order may be part-filled in which case the corresponding transaction size will be applied to the client account and any remaining unfilled part of the order would be cancelled at the close of business of that trading session. ‘Market Orders’ are orders that are triggered at a certain price and at which point the entire order is placed into the ‘underlying market’ and filled at the best available price at that time. BuzzFx will place the order on to the electronic order book for the instrument concerned or, in the case of a non- electronically traded financial instrument; will place the order with a nominated broker who has access to the market makers who provide liquidity in the instrument concerned.
In the case of electronic execution of ‘Market Orders’ BuzzFx will attempt to work the order with reference to the price or costs (spread), the likelihood of execution, the expected speed of execution and the size and nature of the order. BuzzFx will use its experience to attempt to achieve the best possible outcome in relation to the aforementioned reference points for the client. Market Orders may be subject to significant slippage and will only be filled in their entirety if there is the ‘underlying market’ liquidity available to achieve. The subsequent transaction will be made at a single price reflecting the average price achieved by the ‘Market Order’. If at any time BuzzFx receives a price improvement on either of these order types then this price improvement must be passed onto the client.
Both order types may be cancelled by the client at any time but once an order has been activated it is unlikely that you will be able to cancel the whole transaction and you are obligated to accept any part of a worked order that is filled prior to cancellation.
BuzzFx quotes prices with reference to a variety of factors which include the ‘underlying market’ price, the spread quoted by BuzzFx, the time to expiry of the market, any dividends, stock splits, scrip issues or special cash payments of whatever nature which occur before the expiry of the market, interest rates, competitor pricing and weight of client business.
Further information in relation to the spreads for each market may be found on our Market Information Sheets.
In exceptional circumstances (such as increased volatility or illiquidity in relation to the underlying market concerned) BuzzFx may be forced to alter the spreads offered.
When you provide us with specific instructions as to how to execute your transaction or order, then this may prevent BuzzFx from taking the steps as set out in this Order Execution Policy. Such instructions will take precedence over other aspects of BuzzFx’s Order Execution policy. In those circumstances, our execution in accordance with your instructions will be deemed best execution.
(Slippage) - In most cases a standing order when triggered by market price action will be filled at the same, or very close to the same, price as requested on your order request. If the market opens at the start of the trading day at a price sharply different to the closing price of the previous trading session any order whose activation price is between the closing BuzzFx quote of the previous day’s trading close and the opening quote of the next day’s trading session will be filled at the first price reasonably obtainable by BuzzFx with reference to the ‘underlying market’. This policy applies in the event of either advantageous or disadvantageous price movements.
If any market gaps from one quoted price to another due to an announcement of market sensitive information, (such as a profit warning or an economic data release) then any order in place between these prices will be activated. The execution price of any order affected by price sensitive information will be subject to general exchange rules. This means that they will be filled AFTER any transaction requests placed at the same time. For this reason, although there may be tick prints on charts provided by BuzzFx that suggest better potential fill levels, an order activated by a major economic data announcement, by a profit warning or other significant market event may be subject to fill levels significantly different to these momentarily available quote levels and will also be filled with consideration to the size of the order in question.
Market Hours - Aside from those markets defined as being quoted ‘out of hours’ no order will be filled outside of BuzzFx’s specified quoting hours. Please note that some markets continue to trade outside of the quoting hours offered by BuzzFx and in these cases there is significant potential of some gapping from one BuzzFx trading session to the next BuzzFx trading session. All orders in these markets will be subject to this gap in prices. Orders activated in ‘out of hours markets’ quoted by BuzzFx are treated as though the underlying instrument were open and trading at that level required to activate the order.
Guaranteed Stop Orders -Where you give instructions via the use of a Guaranteed Stop Order, specifying the price at which a position is to be closed if the market moves against you, those instructions take precedence over other aspects of our Order Execution Policy. A transaction which has a Guaranteed Stop Order set against it will be closed at the specified level if it is reached.
Leverage - The standard leverage for all trading accounts when established is (1-100) and may be changed by request through the client portal.
General Leverage Scale:
Good till Cancel (‘GTC’) (= Expiry) - This is a time setting that the client may apply to ‘pending orders. The client may choose a specific date in the future until which the order may remain ‘live’ and pending execution. If the order is not triggered during this timeframe it shall be deleted from the system.
Pending Order Modification / Cancellation: - The client may modify/ cancel a ‘pending order’ if the market did not reach the price level specified by the client.
Bid prices on charts - Charts in the terminal show only the bid prices whereas the ask price is not shown in the chart in any way. However, for the opening of long positions and closing of short ones, ask price is always used. You can make the ask line visible by enabling the 'Show ask line' parameter in which case an additional horizontal line corresponding to the current ask price of the last bar will appear in the chart.
Trailing stops: - Stop Loss is intended for the reduction of losses where the symbol price moves in an unprofitable direction. If the position becomes profitable, Stop Loss can be manually shifted to a break-even level. To automate this process, Trailing Stop was created. This tool is especially useful when prices change strongly in the same direction or when it is impossible to watch the market continuously for whatever reason. Bear in mind that Trailing Stops operate in the client terminal and not in the server (as with Stop Loss or Take Profit) and will therefore not work if the terminal is off.
Buy Stop Limit and Sell Stop Limit Orders - These are orders that combine the features of a stop order with those of a limit order. A stop-limit order will be executed at a specified price (or better) after a given stop price has been reached. Once the stop price is reached, the stop-limit order becomes a limit order to buy (or sell) at the limit price or better.
EAs and HFT (high frequency trading) – MetaTrader 5 is fully compatible with Expert Advisors and automated trading systems as allowed by the prevailing market forex conditions and liquidity. Bear in mind that EAs and HFT operate in the client terminal and not in the server (as with Stop Loss or Take Profit). They will therefore not work if the terminal is off.
Important Notice: - In the event of any dispute arising regarding the customer account/s and/or any open or closed positions within customer account, BuzzFx has the right to internally investigate and audit this/ these account/s including all open and closed transactions. Simultaneously, the account/s funds shall be frozen, and no transactions will be allowed until the dispute is completely resolved.
Liquidation of Accounts
Definition: Scalping is a trading strategy based on one or all the following principles:
The smaller the distance in pips between open and close price, the shorter the time between open and close positions, the higher the frequency of the trades, the more chances you will be qualified as a scalper. Scalping is allowed under one or all the following conditions:
Monitoring and Review
BuzzFx will regularly monitor the effectiveness of this Execution Policy in order to identify and, where appropriate, correct any deficiencies and to ensure that it complies with all regulatory requirements and will continually review the various execution venues that it uses to create ‘our quotes’.
Glossary of Terms
Client Agreement - The contractual agreement that you enter into when opening an account with BuzzFx.
Execution venue - A location where financial instruments can be traded (i.e. the New York Stock Exchange, NYSE) BuzzFx is the sole execution venue for your transactions placed via its internet portals or over the telephone.
Market - An individual market on which you can enter into a transaction.
Order -This is where you give an instruction to execute a transaction at a price that is not currently available in the market but may be available at a future date/time.
Our Quote - The price quoted by us in each market via our trading platform or over the telephone.
Open Position - A situation where you have an exposure to a particular market due to the fact that you have an unexpired transaction active on your account.
Transaction - The action of entering into a transaction using a quote given by BuzzFx to either open a position or to close (or part close) an open position.
Underlying Market - A financial instrument acquired from an execution venue or from a wholesale quoting counterpart which underlies the quote made by BuzzFx. For example the UK 100 Rolling Daily price is calculated with reference to the most liquid UK 100 futures contract (commonly called the Front Month) plus or minus a Fair Value (FV), which is comprised of ‘cost of carry’ time value plus any expected dividend component between now and the expiry of the UK 100 future. So the ‘underlying market’ for the UK 100 Rolling market is the UK 100 future (not the UK 100 index itself).