Newton Crypto Ltd. (“Newton”), as a Dealer Member of the Canadian Investment Regulatory Organization (“CIRO”), is required under CIRO Rules to establish, maintain and ensure compliance with written policies and procedures that are reasonably designed to achieve “best execution” when acting for a client. This Best Execution Policy is intended to provide a clear and easy-to-understand summary of the measures that Newton takes to achieve “best execution” for client orders — which means obtaining for our clients the most advantageous execution terms reasonably available under the circumstances, considering prevailing market conditions.
Best Execution Factors
The determination of whether best execution has been achieved is subject to reasonable efforts and should be interpreted in the context of the following broad factors:
- price
- speed of execution
- certainty of execution
- overall cost of the transaction
Newton diligently pursues the execution of each and every client order. Different kinds of orders may be handled differently, depending on the type of order and the way in which it is submitted to Newton by the client. Newton supports:
- Request for quote (RFQ) market orders which specify the desired trading pair and quantity, and for which clients receive a quote which they approve prior to execution, including, for clarity, swaps, buys, and sells. Quotes are valid for a limited period of time and must be refreshed if they expire prior to the execution of the trade.
- Recurring buy market orders which allow a client to specify the desired trading pair, quantity, and frequency, and automatically enters a market order at the set frequency and executes at the best quoted price available at the time of execution including, for clarity, swaps, buys, and sells.
- A limit order (including for clarity stop orders) which specifies the desired trading pair, quantity and price at which the client wishes to transact and which remains open on the client’s account until such future time as when the price from the Liquidity Provider plus the 'spread' meets the price entered by the client, then the client's order will automatically be executed either in part or in full, including, for clarity, swaps, buys, and sells.
Newton uses a variety of measures to ensure that your trades will always execute at the best price available under the circumstances that prevail at the moment when you confirm your trade.
For any trade type, in establishing the quote, which is the price at which Newton will buy a digital asset from you, or sell a digital asset to you, Newton:
- Requests pricing from Newton’s liquidity providers and, in the case where more than one price is provided by liquidity providers, Newton will select the provider with the better price
- Adds a spread to that price. This spread is a type of compensation which Newton earns and is applied as a percentage to the total price of the order. Newton’s spreads will be within a target range as applicable to that asset’s spread tier as disclosed on https://www.newton.co/prices.
Newton also performs post-trade reporting and alerting to ensure that the firm has provided best execution and is alerted as soon as possible to anomalies and errors. These post trade reports and alerts include:
- Daily manual reviews examining: the total volume of trading, the spread rates by crypto assets, the percentage of orders directed to each liquidity provider, the ratio of limit orders that executed.
- Anomalies are investigated on a case by case basis as they are identified during daily trade reporting
- Alerting when trades execute at spreads in excess of 1.9%, or less than 0.055%
- Alerts are triggered directly into Newton’s emergency communications channel and are handled by the on-call development team, which may include raising alerts with additional staff as appropriate
- Alerting when available limits with liquidity providers exceed 30%
- Alerts are triggered into Newton’s trade alerting channel and are addressed by Newton’s trading team by either performing an early settlement with liquidity providers to reduce limit usage, or by negotiating a temporary increase to our limits.
- Alerting when 3rd party pricing exhibits a wide variance from the executed price
- Alerts for variance under 5% are triggered in Newton’s trade alerting channel as a non-urgent warning, and are logged for historical record keeping purposes only
- Alerts for variance under 15% but more than 10% are investigated as part of the daily trade reporting process. If further action is required, it is taken.
Alerts for variance greater than 15% variance are investigated urgently as they are triggered. Appropriate on-call developer resources are alerted, and trading for the affected asset is halted, if required.
Trading on our platform is available 24 hours a day, 7 days a week, providing you with the flexibility to manage your assets at your convenience. For any questions or assistance, our dedicated support team is here to help and can be reached anytime at https://www.newton.co/support.
