Existing Users My Favorites My Portfolio

Important New Info:

• Important Information
• Terms And Conditions of Business
• Client Classification
• Best Execution Disclosure Statement
• Conflicts Policy
• Non-Independent Research

Conflicts Policy

City Equities (‘the Company’) Conflicts Policy

Introduction

This document (‘the Policy’) sets out the Company’s policy on conflicts of interest. The purpose of the Policy is to:

(a) Identify the circumstances which constitute or may give rise to a conflict of interest entailing a material risk of damage to the interest of one or more clients; and

(b) Specify the procedures to be followed and measures to be adopted in order to manage such conflicts of interest.

The Policy also details the Company’s approach to disclosure of conflicts of interest to clients.

A summary of the Policy (as set at Annex A) will be included in the Company’s standard terms of business.

Identification of Conflicts

The Company has identified the following circumstances as potentially giving rise to a conflict of interest:

(a) Dealing as Principal
The Company frequently trades as principal when executing orders on behalf of customers. The Company will often acquire securities which will subsequently be sold to clients with a view to making a profit from the sale.

(b) Non-Independent Investment Research
The Company prepares and disseminates non-independent investment research. Such research will be used by the Company to select stocks and will also be distributed to clients.

The Company reasonably believes that the above circumstances represent the only conflicts which may entail a material risk of damage to the interests of its clients. The Company is not aware of any other such conflicts.

Conflicts Management

The Company takes all reasonable steps to prevent the conflicts identified above from giving rise to a material risk of damage to the interests of its clients. The following specific steps have been taken in relation to the conflicts identified:

(i) Remuneration & Supervision
Sales staff (i.e. those involved in executing customer orders) are paid a salary and commission. In order to mitigate the risks associated with the conflicts identified at (a) above, the amount of commission is calculated by both qualitative as well as quantitative factors. In considering the amount of commission payable, the Company will have regard to specific Key Performance Indicators (the ‘Sales KPI’). The Sales KPI include the quality of relationship management calls made to clients, the quality of record-keeping and the number of complaints made about an individual.

Administrative staff, which includes staff involved in the preparation of research and those with supervisory or management functions, are paid a salary with the possibility of a discretionary bonus. Any bonus payments made to administrative staff will be based on the overall profitability of the Company and individual performance. For example, bonus payments to supervisory staff will be determined by reference to their own performance in exercising their supervisory responsibilities with no regard to the quantity of sales made by the staff under their supervision.

(iii) Personal Account Dealing
The Company prohibits all members of staff from trading in ‘Penny Shares’, regardless of whether the particular share is or has been traded by the Company.

(iv) Information Barriers
The Company limits the involvement of investment research staff in other parts of the business. In particular, investment research staff have no involvement with sales staff. The Company has established information barriers designed to limit the nature and timing of any information passing from the investment research department to the sales teams.

(iv) Gifts & Entertainment
The Company restricts the extent to which gifts, entertainment or other benefits may be offered or accepted by its employees. Gifts over £25 are prohibited and all entertainment is subject to prior approval by the Company.

The Company is also subject to a number of regulatory obligations which help to mitigate the risk of damage to its client interests. For example, the Company is required to take reasonable steps to ensure that any recommendations made to a client are suitable for that client. In addition, when executing customer orders the Company must take all reasonable steps to obtain the best possible result for the client, having particular regard to the total costs for the client. Any fee, commission or benefit received from a third party must be disclosed by the Company to its clients and may only be retained where it is designed to enhance the quality of service offered to clients.

Disclosure

The Company has reasonable confidence that the arrangements described above are sufficient to ensure that risks of damage to the interest of its clients will be mitigated. However, the Company believes that its clients should be made fully aware of the existence of the potential sources of conflicts of interest.

Where the Company executes a customer order as principal it will disclose its status to the customer at the point of sale. The potential for the company to act as principal to a customer order is also disclosed in various documents including the terms of business and order execution policy.

In addition, where the Company acts as principal it will also disclose the price at which the relevant security was purchased by the Company.

ANNEX A: POLICY DESCRIPTION - FOR TERMS OF BUSINESS

City Equities has implemented a conflicts of interest policy (‘the Policy’). The Policy documents the conflicts of interest arising from the activities undertaken by City Equities and the measures adopted to mitigate the risk of damage to customer interests which might otherwise result from such conflicts. Conflicts may arise where City Equities deals as principal with a customer and where City Equities issues non-independent research. City Equities has put in place arrangements relating to the remuneration and supervision of staff, personal account dealing and information barriers. Further details of the Policy are available on request.