Terms and conditions

Nutmeg's Terms and Conditions

Active from 16 September 2013 until 22 December 2014. See the terms effective after that »



In these Terms and Conditions, references to "us" and "we" means Nutmeg Saving and Investment Limited, trading as Nutmeg. The term "customer" and "client" and "you" and "your" means any person operating an Account with us.


These Terms and Conditions together with information you provide in your profile and your portfolio on the website www.nutmeg.com (your “Account”) constitute the Investment Management Agreement ("Agreement") between you and us for the provision of investment services as set out below. Our registered address is 5 New Street Square, London EC4A 3TW (Company No 07503666). We are authorised and regulated by the Financial Conduct Authority ("FCA"), whose address is 12 Endeavour Square, London E20 1JN, www.fca.org.uk. Our firm registration number is 552016.


These Terms and Conditions contain important information regarding the services that we will provide to you and for your own protection you should read them carefully before accepting them. If you do not understand anything in these Terms and Conditions please email support@nutmeg.com and ask for further information.




This Agreement will become legally binding and we will start providing the services to you once we have received confirmation of your completed Account and satisfactory money laundering verification information as set out at clause 4.1 below.




We may communicate with you at any time including, when appropriate, by telephone. If as a result of any unsolicited communication, you enter into any investment transaction you will not have the right under Section 30 of the Financial Services and Markets Act 2000 (“FSMA”) to treat such investment transaction as unenforceable.


You can give us instructions and notifications in relation to investments we hold on your behalf (your "Portfolio") electronically using the website, and/or by communicating with us via your Account mailbox ("Nutmail"). We will not be obliged to act on any instruction and in particular we will not act on any instruction where it is illegal or against any relevant rule or regulation to do so. Where we do act on your instructions we will do so as soon as reasonably practicable once we have received them.


We may act on any instruction or other notification which we believe in good faith is from you without carrying out any further checks or investigations. We will not be liable for following an instruction or notification which is not in fact genuine or for not following or for investigating further any instruction or notification we believe may not be genuine. We will not be liable for any error of transmission or misunderstanding, or for the fraud of any other party (except in the case of our negligence, wilful default or fraud as described in clause 21 of this Agreement). We are not obliged to acknowledge receipt of your instructions.


We will send all notices, information and other correspondence to you by Nutmail and/or at the email address set out in the Client Agreement Form or such other email address as you may designate in your personal profile ("Profile") from time to time. In the event any notice, information or other correspondence is sent to you via letter, such letter will be sent to the postal address set out in the Client Agreement Form, or such postal address as you may later designate in your Profile, and will be deemed to be delivered on the second business day after posting.


We may record and monitor telephone conversations that we have with you. We will store recordings for the period required by law or for as long as we consider appropriate.


We cannot guarantee that electronic communications will be successfully delivered, or that they will be secure and virus free. We will not be liable for any loss, damage, expense, harm or inconvenience caused as a result of an email being lost, delayed, intercepted, corrupted or otherwise altered or for failing to be delivered for any reason beyond our reasonable control.


All communications in relation to services provided under this Agreement will be in English.




We are required to verify your identity in accordance with UK money laundering legislation. For this reason we may use your personal data, as that phrase is defined in the EU Data Protection Directive (“personal information”), in order to carry out electronic searches on private and public databases. We will keep records of any information obtained. We may use credit reference agencies which will record that an enquiry has been made. By entering into this Agreement you confirm your acceptance of our use of credit reference agencies which will result in such a record.


In order to provide services to you we need to collect, use, share and store personal financial information about you, including your personal information. We make every effort to protect the privacy of our customers' personal information. Other than as set out below, your personal information will not be disclosed, transferred or sold to any third party for any purpose.


You authorise us to use any of your personal information which is relevant to our provision of services to you for all reasonable purposes in relation to your Portfolio. We may retain and continue to process your personal information after the termination of this Agreement or any other agreement between you and us. Your personal information may be processed by or transferred or disclosed to and/or by third parties where necessary to enable us to provide services to you, including your financial advisor (if relevant) and relevant stock exchanges and regulators. Your personal information may be transferred outside of the European Economic area.


With your consent, your personal information may be used by us in order to provide you with information and marketing materials in relation to our other products and services. By entering into this Agreement you confirm your wish for your personal information to be processed for these additional purposes. If you do not wish your personal information to be processed in this way, please notify us by Nutmail or by contacting the Data Protection Officer at support@nutmeg.com.


You can request copies of your personal information held by us or any service provider we appoint to provide you with the services under this Agreement by notifying us by Nutmail or by contacting the Data Protection Officer at support@nutmeg.com. We charge a fee for providing you with this information as set out in the Fees and Charges Schedule at Appendix 5. You should notify us if any of the information held is incorrect.




Services provided by us under this Agreement will be on the basis that you are a Retail Client as defined in the FCA Handbook. This means that you are entitled to the protections that must be provided to Retail Clients under the rules contained in the FCA Handbook (the FCA Rules) and under relevant legislation. If you would like further information on the nature of these protections, please notify us by Nutmail or by contacting the Compliance Officer at support@nutmeg.com.




The services that we will provide under the terms of this Agreement are only available to UK residents, partnerships formed under the laws of the UK or bodies incorporated in the UK which may include corporate bodies, charitable foundations and investment and unit trusts. At our discretion and in line with our regulatory permissions we may accept non-UK residents who approach us as a potential customer providing we are able to satisfy certain requirements to confirm the status and identity of such customers. Nutmeg is currently unable to offer services to US passport holders regardless of where resident.


We will provide you with a number of different levels of services under the terms of this Agreement as follows:

  • (a) discretionary investment management of your Portfolio;

  • (b) safe custody of your investments; and

  • (c) ISA management services,

together (the "services").


We have appointed a custody services agent (the "CSA") to provide all post execution services you may require whose services will be provided to you on and subject to the terms set out in Appendix 4 to this Agreement. We are not responsible for the provision of any post execution services although we may assist you and the CSA in providing those services. Our responsibilities to you will cease as and from the point at which we confirm to you the execution of any order we have executed with you or on your behalf.




Your Account comprises personal information about you and your risk profile in addition to different investment objectives in each of your funds (“Funds”) within your overall investment Portfolio.


You have advised us of your investment and risk objectives ("Objectives") in your Account. We will use these to manage your Account. You may change your Objectives at any time by updating your Account or by contacting us by Nutmail and/or email at support@nutmeg.com. We reserve the right to amend and reissue the Agreement following such change. You agree that the Account is fair and reasonable and an accurate reflection of your Objectives, unless you notify us of any change you wish to make or where we consider changes are necessary following a periodic review.


We will manage your Portfolio on a fully discretionary basis. This means that we will make investment decisions in relation to the cash/assets in each of your Funds within your Portfolio on your behalf in accordance with information in your Account. We will take all reasonable steps to manage each of the Funds in your Portfolio with due care and skill.


We will manage your Portfolio in accordance with the information in your Account. Provided that we do so, you grant us full authority, at our sole discretion, to enter into any kind of arrangement or transaction on your behalf including investing in any type of investments or other assets. For the avoidance of doubt, there will be no limit on the amount of your Portfolio that we may invest in any one investment, or on the proportion of your Portfolio that any one investment may make up, and there will be no limit or restriction on any particular type of investment, or currency, or on the markets on which transactions are carried out.


We may make common investment decisions which apply to a number of customer portfolios including your Portfolio.


Please see the general description of the nature and risks of the investments in which you may invest contained in Appendix 2 of these Terms and Conditions. Please note that we are unable to provide any guarantee as to the performance of any particular investments or a portfolio as a whole.




For each fund in your Portfolio, we require an initial investment above one of the following thresholds:

  • (a) for an initial investment without a regular monthly payment, a basic threshold of £5,000; or

  • (b) for an initial investment with a regular monthly payment of at least £50, a lower threshold of £1,000.


If you subsequently withdraw money to bring the value of a fund in your Portfolio below a minimum investment of £1,000, we reserve the right to sell the holdings in that fund and hold your investment as cash.




Where we make a decision to deal on your behalf in relation to your Portfolio, we will assess the suitability of the transaction for you based on the information you have provided to us about your knowledge and experience of the investment field relevant to the particular kind of investment, your financial situation and your Objectives, in accordance with the relevant FCA Rules.


We will provide you with a suitability report which sets out the basis for our portfolio management strategy, as required by FCA Rules.




Where we deal on your behalf, we will normally be required to provide best execution, meaning that transactions entered into should be on the best terms reasonably available. To achieve best execution we will deal in accordance with our best execution policy ("Best Execution Policy"), as detailed in Appendix 1.




We may pool (aggregate) your transactions with those of other customers without seeking agreement from you beforehand. We will only do so where we believe that this is unlikely to disadvantage your overall position, although it may do so in relation to any specific order.




We reserve the right to perform any of our obligations to you through the agency of an associate or any third party of our choosing. This means that we may appoint another person or entity to provide the services to you under this Agreement. We will take all reasonable steps to satisfy ourselves that any person whom we appoint to provide any services to you or to perform any of our obligations on our behalf is suitably competent to do so. We will ensure that all such parties commit to provide you with best execution as set out in the FCA Rules where this is applicable.


Where appropriate in light of your Account, we may offer to refer you to third parties to provide certain additional services. We will not make any such referral without your agreement. We may also accept referrals of business from third parties.




Our fees and charges are calculated on the basis and at the rates shown and are payable as set out in the Fees and Charges Schedule at Appendix 5. We reserve the right to change these rates from time to time and will notify you of any such changes in writing.


We may deduct any amounts payable by you to us from your Account. If the available funds are insufficient, we may sell assets held as part of your Account to cover such charges.


Where we invest in Collective Investment Schemes we may receive a commission from the manager of the Collective Investment Scheme invested in. In these circumstances we will credit your Portfolio with the amount of the commission.


We may pay (or receive from third parties), fees in relation to referrals of business.


We may receive payment from or share charges with a third party. Further information about such payments or shared charges is available on request.




If we are providing discretionary management services to you, we will provide valuation reports to you electronically on a six monthly basis dated 5th October and 5th April. These reports will include details of all transactions during the relevant period, details of the contents of your Account, the current market value and the basis of valuation, income and interest and fees charged.


If your employer requires confirmation we will provide a letter certifying the provision of discretionary management services. In general most employers will accept an electronic copy of this letter which we will provide free of charge. If however you require an original signed copy we can post this to you, the fees for which are defined in Appendix 5. Requests to issue certification letters should be sent to us by Nutmail.




Unless otherwise expressly agreed in advance in writing, we may deal on any markets or exchanges and with any counterparties that we believe provide the best outcome reasonably available. All transactions will be carried out in accordance with the rules and regulations of the relevant market or exchange, and we may take any steps as may be required or permitted by such rules and regulations and/or by appropriate market practice.




Any cash from time to time held in your Account will be held in accordance with the FCA customer money rules in one or more segregated accounts with an approved bank. Customer money accounts may include the balances of more than one customer. Customer money may also be placed on overnight or short-term deposit. We will act in good faith and with due diligence in the selection and monitoring of banks holding customer money. Where relevant you will be responsible for any additional income tax liability which may be incurred.


We may operate customer money accounts outside the UK and therefore please note that:

  • (a) different legal and regulatory provisions will exist outside the UK and the protections may not be equivalent to those available in the UK. In the event that a bank outside the UK defaults, otherwise fails or is unable to meet its obligations, money held on behalf of customers may be treated differently than if the money was held in the UK;

  • (b) we will only hold customer money in an account outside the UK where the relevant bank has confirmed that all money standing to the credit of the account is held by it as trustee and that the bank is not entitled to combine or set off the account in respect of any money owed to it on any other account held with it, whether in our name or not.


Customer money may be passed by us to a settlement agent in a jurisdiction outside the UK. If the settlement agent defaults, fails or is unable to meet its obligations, customer money may be treated differently from the position which would apply if the money was held in the UK.


We reserve the right to only make external payments to and to accept payments from the bank account stated in your Account.




Income earned on the investments held in your Portfolio which is payable to you will be remitted to your Portfolio and may be reinvested.




Interest earned on cash in your Portfolio is calculated on at least a half annual basis at a rate which will not be less than that set out in Appendix 5. Interest earned on cash will be remitted to your Portfolio and may be reinvested.




We have entered into an agreement with the CSA to provide all post execution services to our customers on our behalf. Details of the CSA are set out at Appendix 4. The current terms and conditions under which the CSA will provide services to us and to you are set out in the agreement we have entered into with the CSA (the "Clearing and Settlement Agreement"). Under the Clearing and Settlement Agreement we as your agent contract with the CSA to provide their services to you on the terms and subject to the conditions of the Clearing and Settlement Agreement as set out in Appendix 4. This forms a binding agreement between you and the CSA.



Both we and the CSA have the right to terminate the Clearing and Settlement Agreement. We are not obliged to provide prior notice to you before terminating our relationship with the CSA or appointing a replacement CSA. We will notify you of the identity of any replacement CSA we may appoint.




We or anyone connected with us, may carry out certain transactions for you where we, or another customer of ours, have a duty that may conflict with our duty to you. We will manage any such conflict or potential conflict to ensure that it does not materially affect the transactions we carry out for you. We will inform you if consider that we cannot adequately manage a conflict.


Our Conflicts of Interest Policy is detailed in Appendix 3. This sets out the types of actual or potential conflicts of interest which may arise given the nature of our business and provides details of how these are managed. Further details and updates of this policy can be provided on request.




We accept responsibility for any loss, damages or costs suffered or incurred by you only to the extent that such loss arises directly from our gross negligence, wilful default, fraud, and/or our deliberate and wilful breach of any duties which we owe you under FSMA, FSMA Regulations or FCA Rules. We will not be liable for any other losses, damages or costs suffered or incurred by you.


We will take reasonable care in the assessment and appointment of sub-custodians, bankers, counterparties, agents and other third parties. We accept responsibility for any loss, damages or costs incurred by you only where these arise from our, negligence, wilful default or fraud in the assessment or appointment of such persons. We will not be responsible in any other circumstance for the actions of any such third parties.


We do not accept responsibility for any loss, damages or costs you may incur as a result of any cause beyond our reasonable control.




You will indemnify us against any liability, cost, expense, loss or any damage incurred by us (including but not limited to professional advisors' fees) arising from your breach of this Agreement, negligence, wilful default or fraud.




No provision of this Agreement will be deemed to restrict, qualify or exclude any duty owed to you under "FSMA" or the FCA Rules. We do not, however, owe you any further duties except as expressly set out in this Agreement.




We may amend this Agreement by giving you 10 business days' notice by Nutmail and/or email. If we are required to amend this Agreement for reasons of compliance with the FCA Rules, or any other applicable law or regulation, however, we may do so with immediate effect.




Should you have any complaints in relation to the services, please notify us by Nutmail and/or by emailing the Compliance Officer at support@nutmeg.com. We will aim to acknowledge your complaint promptly, investigate the circumstances and report the results to you.


If your complaint is unresolved 8 weeks from the date you first made the complaint you may refer it directly to The Financial Ombudsman Service ("FOS"). The address of FOS is South Quay Plaza, 183 Marsh Wall, London E14 9SR www.financial-ombudsman.org.uk. Certain customers, such as larger companies and trusts may not have access to the Financial Ombudsman Service.




Nutmeg is covered by the Financial Services Compensation Scheme ("FSCS"). You may be entitled to compensation from the FSCS in the event that we have stopped trading or are declared to be in default and we cannot meet our obligations. This depends upon the type of business and the circumstances of the claim. The FSCS offers different levels of cover for different types of business. Most types of investment business are covered currently for 100 per cent of the first £50,000. Further information about compensation arrangements is available from the FSCS (www.fscs.org.uk) of FCA.


In the event that an investment is unable to meet its obligations, this will not in itself entitle investors to compensation from the FSCS. Likewise if the performance of a fund does not match any illustrated benefits, investors will not, for that reason alone, be entitled to any compensation under the FSCS.




You may terminate this Agreement at any time, to take effect 30 days after we receive notice from you via Nutmail or through the website, subject to the settlement of all outstanding transactions. The charges as outlined in the Fees and Charges Schedule will apply. We may pass on to you charges levied by third parties as a result of the termination of this Agreement. Transactions already in progress will be completed in the normal course of business.


We may terminate this Agreement by giving you 30 business days' notice in writing, subject to the settlement of all outstanding transactions.


No additional amount will be payable solely for terminating the Agreement, except that you will pay a due proportion of our fees to the date of termination, the transfer charges as outlined in the relevant Fees and Charges Schedule, any expenses reasonably incurred by us in giving effect to such termination and any losses incurred in settling or concluding outstanding obligations.


We may deduct these fees and expenses from any money forming part of your Portfolio and/or sell sufficient assets from your Portfolio to cover such fees and expenses.


On termination of this Agreement, we will, following payment in accordance with clause 27.3 and settlement of all outstanding transactions, re-register your assets and transfer your cash as you reasonably request. If you make no reasonable request we will take steps to re-register your assets in your name and to transfer your cash to you at our discretion.


In the event that either you or the CSA close your account held with the CSA (see Appendix 4 clause 3.5) Nutmeg reserves the right to terminate this Agreement with immediate effect applying clauses 27.3 through 27.5 above.




You do not have the right to assign or otherwise transfer to any other party your rights or obligations under this Agreement.


We may assign our rights and obligations under this Agreement at any time, and will send you notice by Nutmail and/or email of any such assignment prior to its taking effect.




We will mark any Account as dormant if it has been inactive for at least one year to protect both you and us. If you ask us, we will tell you how you can access your Account. If you have money in a dormant Account, it will remain your property (or if you die it will form part of your estate).




This Agreement constitutes the entire agreement between you and us and supersedes and extinguishes all previous agreements and arrangements between us, whether written or oral, relating to its subject matter.




This Agreement and any dispute or claim arising out of or in connection with it (including non-contractual disputes or claims) will be governed by and construed in accordance with the law of England and Wales.


The parties irrevocably agree that the courts of England and Wales will have exclusive jurisdiction to settle any dispute or claim that arises out of or in connection with this Agreement (including non-contractual disputes or claims).




You have a period of 14 days, beginning on the date on which your Account is opened or the date on which you receive a copy of these Terms and Conditions and other related documents, whichever is the latest, within which to cancel your Account. Nutmeg will sell any investments made on your behalf but will not be responsible for any market loss that you may incur as a result.




A person who is not a party to this agreement cannot enforce or enjoy the benefit of any term of this Agreement under the Contracts (Rights of Third Parties) Act 1999.




This section contains additional terms and conditions applicable to the Stocks and Shares ISA. It should be read in conjunction with our Terms and Conditions for the provision of investment services. The Agreement for your Stocks and Shares ISA will consist of your Account, the Terms and Conditions, these Additional Terms and the Nutmeg Stocks and Shares ISA Application Form on the website and/or Nutmeg ISA Transfer Form.


You are subscribing to this Stocks and Shares ISA for the current tax year and each subsequent tax year in which you subscribe to the Stocks and Shares ISA, and/or transferring to us a current tax year and/or previous tax year ISA from another ISA manager.


You cannot subscribe to a Stocks and Shares ISA if you have already subscribed to any other Stocks and Shares ISA in the same tax year.


To subscribe for a Stocks and Shares ISA you have to be a UK resident aged 18 or over. Nutmeg is currently unable to offer Stocks and Shares ISAs to US passport holders even if they are resident in the UK.


This agreement will commence on the day we have both a valid application and receipt of your first subscription, or where you are transferring to us from another ISA manager, on the day we have both a valid transfer application form and receipt of the proceeds of transfer from your previous ISA manager.




Your Stocks and Shares ISA will be invested on a discretionary basis in accordance with your Objectives set out by you in your Account subject always to the requirements of HM Revenue & Customs ("HMRC").


For each new tax year, all contributions to your Account will be allocated first to your Stocks and Shares ISA until the maximum subscription is reached for that year, or until your own pre-set limit. Once the maximum subscription or your own pre-set limit is reached, future contributions are allocated to the non-ISA remainder of your Account.




Investments into a Stocks and Shares ISA may be by cheque, bank transfer, transfer of cash from an existing Portfolio held with us or by transfer from another ISA manager (subject to HMRC's ISA transfer rules).


You will at all times be the beneficial owner of any investments held in your ISA. You must not use the investments and/or cash in your ISA as security for a loan except to the extent permitted by the Individual Savings Account Regulations 1998 ("Regulations").


Your investments will be registered in the name of, or otherwise held to the order of the CSA, as the ISA Manager's Nominee. You will at all times remain the beneficial owner of any of your investments that are held by the CSA.


The total of contributions to be invested in any tax year will not be more than the maximum permitted to be invested in stocks and shares by the Regulations for that tax year.




If you so request in writing, we will arrange for you to:

  • (a) receive the report, accounts and other information issued by a company, attend and vote at such shareholders’ meetings or unit holders’ meetings. Where you do this, we shall use reasonable endeavours, where possible, to make appropriate arrangements on the terms and within the timescales we may impose; and

  • (b) exercise any voting rights attached to your investments, whether exercisable at an AGM or otherwise. We are not obliged to but we may notify you of any AGMs applicable to your investments.



You will not incur tax liabilities by withdrawing. We will send an acknowledgment of your instructions to you at the email address you designate in your Account.


At your request, we will transfer all or part of your ISA investments (with the associated rights and obligations) to another ISA manager, subject to HMRC's ISA transfer rules.


We will process your withdrawal or transfer request promptly and normally within the 30 day maximum period stipulated by HMRC, subject to circumstances outside our control. Should you wish the withdrawal or transfer to take place at a particular time, we will endeavour to meet this request. However, in the case of transfers, we are reliant on the receiving manager and cannot guarantee to do so.




You authorise us to disclose to HMRC all such information as required by law. We will notify you in writing if, by reason of any failure to satisfy the provisions of the Regulations, your Stocks and Shares ISA becomes void.




We will satisfy ourselves that any person to whom we delegate any of our functions or responsibilities under the terms agreed with you is competent to carry out any of those functions and responsibilities.




We last updated this Agreement on 16 September 2013.




We are dedicated to treating customers fairly.


We are obligated by the EU Markets in Financial Instruments Directive (“MiFID”) to undertake bargains without disadvantaging its customers. In particular, MiFID Article 21.1 specifies that we “must take all reasonable steps to obtain the best possible result, taking into account price, costs, speed, likelihood of execution and settlement, size, nature or any other consideration relevant to
the execution of the order.”



We have developed procedures with our execution venue to both achieve and record that each bargain has been fulfilled according to the principle of best execution. The procedures will be reviewed periodically to ensure customers are treated fairly.


Upon receipt of an order, relevant factors will be considered by our execution venue to achieve best execution including stock liquidity, ability to deal on more than one market trading system choices and any specific conditions attached to the order by the customer. If these factors and any other pertinent information are duly considered, we anticipate best execution will be attained for the customer. We will inform the customer if any particular bargain conditions are attached which may restrict the achievement of best execution.


Any customer limit order will be accepted on a best endeavours basis and will only be accepted for the duration of the trading day on which the limit was given.


The principles of best execution apply equally to single bargains or orders which are aggregated.


2.5 The principles of best execution do not extend to bargains for direct commodities, currency or unit trust funds.



Eligible investments include:

  • (a) UK equities: bargains may be transacted via electronic order books, retail service providers, agency crosses, direct telephone engagement and electronic algorithmic systems;

  • (b) Non UK equities: the firm's execution venue will make use of appointed market representatives to deal in overseas markets. Such representatives are also committed to achieving best execution for customers. When dealing in overseas investments extra factors will be considered including extra commissions incurred, applicable local taxes etc which will be reported to the customer;

  • (c) Bonds: Gilts may be traded on the London Stock Exchange thus price information is readily publishable. Other bonds and debt instruments may require off-market trading. Liquidity and variety of counterparties may limit the achievement of Best Execution in such instruments. The Company will keep record of such bargains;

  • (d) Derivatives: Derivative investments traded on an exchange and over the counter (OTC) derivatives both require a specific risk warning consent and trade details may be published in the case of exchange traded items. OTC trades may not necessarily be published thus establishing achievement of Best Execution may be restricted by the extent to which information is available;

  • (e) Other items: Those which do not fall into the above categories may have restricted liquidity or trade venues. Our execution venue will assume best execution has been achieved with reference to any information provided by the market counterparty at each transaction.


Our execution venue will execute the bargain as soon as reasonably practicable unless any delay will better serve the customer's interest. Bargains will be transacted in the same order as they were received unless specific bargains have conditions attached which may alter the order of priority.




We have set out below a summary of the nature and risks associated with the types of investments we may include in your Account, subject to your Objectives as notified to us. This information is not intended to constitute a comprehensive statement of all the risks to which investors might be exposed and there may be others that exist now or which may arise in the future.


The main general risks associated with investing are as follows:

  • (a) Past performance is not an indicator of future performance;

  • (b) The value of investments may go down as well as up;

  • (c) You are not certain to make a profit. You may make a loss. You may lose your entire investment;

  • (d) The price or value of investments may fluctuate significantly;

  • (e) If there are income distributions, they may also fluctuate significantly.



We may invest in shares listed on recognised stock exchanges in the UK (e.g., the London Stock Exchange) and overseas (e.g., the New York Stock Exchange). We may also invest in shares on other approved markets such as London Stock Exchange's Alternative Investment Market ("AIM") or PLUS, a market operated by Plus Markets Group plc.


The main specific risks associated with investing in shares include:

  • (a) Dividend growth is not guaranteed, nor are companies in which you invest obliged to pay dividends;

  • (b) Companies may go bankrupt rendering the original investment valueless;

  • (c) Equity markets may decline in value;

  • (d) Corporate earnings and financial markets may be volatile;

  • (e) If there is no recognised market for shares, then these may be difficult to sell and accurate information about their value may be hard to obtain;

  • (f) Smaller company investments may be difficult to sell if there is little liquidity in the market for such shares and there may be substantial differences between the buying price and the selling price;

  • (g) Shares on overseas markets may involve different risks to the UK;

  • (h) With regard to investments in overseas companies, foreign exchange rates may move in an unfavourable direction affecting adversely the valuation of investments in base currency terms.



We may invest in fixed interest securities issued by governments, governmental bodies, quasi governmental bodies in the UK (and overseas), UK local authorities, corporates in the UK (and overseas).


The main risks associated with investing in fixed interest securities are:

  • (a) There are few recognised markets in such securities, as the trading is between the issuers, their brokers, and the banks and securities houses making a market in the securities;

  • (b) With regard to Securities in currencies other than Sterling, foreign exchange rates may move in an unfavourable direction affecting adversely the valuation of investments in base currency terms;

  • (c) Securities issued by overseas bodies may involve different risks to the UK;

  • (d) Capital may be lost whether or not held to maturity or in the event of default of the issuer;

  • (e) There is a risk of capital erosion in real terms over time due to the effects of inflation;

  • (f) The value of fixed income securities may fall as well as rise due to market movements;

  • (g) Compensation may not be available at all or to the entire extent of deposits made with banks that subsequently default.



We may invest in units/shares issued by collective investment funds both in the UK and overseas, that are authorised by an approved regulator or are unauthorised.


The main risks associated with investing in collective investment funds are:

  • (a) There are no recognised markets for collective investment funds as units/shares are issued and redeemed by the managers/operators/administrators of the funds;

  • (b) Funds may be valued for pricing and dealing purposes either daily, weekly, fortnightly, monthly or even less frequently by the managers/operators/administrators;

  • (c) The prices of the underlying investments of the funds will vary according to the markets on which these are listed or traded;

  • (d) Unregulated funds are not subject to the supervision by a regulatory body as authorised funds, and some authorised funds are subject to greater supervision than others depending on their structure;

  • (e) With regard to funds in currencies other than Sterling foreign exchange rates may move in an unfavourable direction affecting adversely the valuation of investments in base currency terms.



We may, from time to time, carry out such transactions on your behalf, where the price may have been influenced by measures taken to stabilise it. Stabilisation enables the market price of a security to be maintained artificially during the period when a new issue of securities is sold to the public. Stabilisation may affect not only the price of the new issue but also the price of other securities relating to it. The FCA allows stabilisation in order to help counter the fact that, when a new issue comes onto the market for the first time, the price can sometimes drop for a time before buyers are found. Stabilisation is carried out by a 'Stabilisation Manager', (normally the firm chiefly responsible for bringing a new issue to market). As long as the Stabilisation Manager follows a strict set of rules, he is entitled to buy back securities that were previously sold to investors or allotted to institutions which have decided not to keep them. The effect of this may be to keep the price at a higher level than it would otherwise be during the period of stabilisation. We will endeavour not to take part in stabilisation.


The Stabilisation Rules:

  • (a) Limit the period when a Stabilisation Manager may stabilise a new issue;

  • (b) Fix the price at which he may stabilise (in the case of shares and warrants, but not bonds);

  • (c) Require him to disclose that he may be stabilising but not that he is actually doing so.


The fact that a new issue or a related security is being stabilised should not be taken as any indication of the level of interest from investors, nor of the price at which they are prepared to buy the securities.




We may undertake on your behalf, the purchase of securities forming part of investment companies (including investment trusts), that may use gearing as an investment strategy. Gearing is the method by which the investment company may borrow against the investment fund in order to increase the size of the fund. In relation to such securities you should be aware that:

  • (a) Movements in the price of such securities may be more volatile than those in the underlying investments;

  • (b) Such securities and the underlying investments may be subject to sudden and large falls in value;

  • (c) You may get back nothing at all if there is a sufficiently large fall in the value of such securities.


We will email you to tell you when we are undertaking investment in significantly geared investments.




We may effect transactions on your behalf in an investment denominated in a currency other than the agreed base currency of your Portfolio (which is the currency in which your Portfolio is valued).


A movement in exchange rates may have a separate effect, unfavourable as well as favourable, on the gain or loss otherwise experienced on the investment concerned. In addition, if you deposit collateral denominated in one currency, you may be subject to margin calls in circumstances where the obligations secured by such collateral are denominated in another currency (in addition to the risk of margin calls for fluctuations in relative values). Some currencies are not freely convertible and restrictions may be placed on the conversion and/or repatriation of your funds including any profits or dividends.


The base currency of your Portfolio will be Sterling.




Structured Capital at Risk Products do not always guarantee the return of capital at the end of the investment period; the maximum return may only be available after a set period of time and early redemption may result in a poor return or loss; the rate of income or growth may depend upon specified conditions being met which will vary from product to product; there may be gearing (ie borrowing with the aim of increasing investment exposure) of the initial investment, thus a small percentage fall in the related index could result in a larger reduction in the amount repaid to investors.




Our principal service is discretionary investment management where individual Funds are managed in accordance with each customer's requirements as set out in your Account. This means that we have discretion over both asset allocation and individual security selection in relation to the assets held in your Portfolio. This means that your Portfolio and its performance will be specific to you, even when compared to a portfolio with a broadly similar mandate. The firm has a core investment and asset allocation process. We measure on a quarterly basis the asset allocation deviation and outperformance/underperformance of all portfolios relative to each, and to comparative industry benchmarks to ensure that the distribution of customer returns is within acceptable ranges. However, you should be aware that as a result of individual manager discretion within the investment team you may outperform or underperform the "average" customer Portfolio.




Non-complex Financial Instruments must satisfy the following criteria:

  • (a) It is not a derivative or other security giving the right to acquire or sell a transferable security or giving rise to a cash settlement determined by reference to transferable securities, currencies, interest rates or yields, commodities or other indices or measures;

  • (b) There are frequent opportunities to dispose of, redeem, or otherwise realise the instrument at prices that are publicly available to the market participants and that are either market prices or prices made available, or validated, by valuation systems independent of the issuer;

  • (c) It does not involve any actual or potential liability for the customer that exceeds the cost of acquiring the instrument;

  • (d) Adequately comprehensive information on its characteristics is publicly available and is likely to be readily understood so as to enable the average retail customer to make an informed judgment as to whether to enter into a transaction in that instrument.




We are committed to taking measures to recognise, supervise, examine and resolve conflicts of interest. We recognise that it is not possible to eliminate all sources of conflict of interest; however, safeguarding customers' welfare remains our primary objective. This policy encompasses the relationships with customers and third party contacts.



We define a conflict of interest as being either:

  • (a) between us and you as a customer; or

  • (b) between yourself and another customer where your interests are materially affected.



We have identified areas where a conflict of interest may arise. They include, but are not limited to:

  • (a) services in different capacities at the same time;

  • (b) providing advice or management;

  • (c) acting for more than one customer in a transaction;

  • (d) holding information on other customers that would affect you or them is it was disclosed;

  • (e) receiving gifts or entertainment which could conflict with our duties to you;

  • (f) employees pursuing activities or personal relationships potentially detrimental to you; and

  • (g) personal account holdings in companies or other investments being recommended by us.



Our protocols are noted below and we consider them satisfactory to allow us to act without bias to prohibit damage to your interests. At all times stringent criteria to address and resolve conflicts is followed. Protocols have been developed and introduced to manage conflicts of interest. Our employees are provided with relevant training about the protocols and standards of conduct expected thereafter. Our management remain responsible for ensuring the protocols and resources are sufficient to identify and attend to a conflict as it may arise.


We maintain an internal log of conflicts that arise, listing how each conflict was monitored and any solution which was developed and applied to resolve the problem and to prevent the customer's interests from being disadvantaged. The effectiveness of our protocols is assessed by internal audit staff members who execute their duties in a wholly independent capacity.


We have in place protocols to prevent unauthorised access or inappropriate dissemination of information.


Where our functions could create an internal conflict our duty lines are kept separate and individual management and reporting structures are established. The operations functions are maintained and conducted separately from the front office functions and in both an appropriate level of qualification, expertise and supervision is applied.



Staff remuneration is by means of a basic salary which is not linked to the underlying performance of the company. A remuneration committee agrees and monitors awards to achieve consistency and equitability and does not lead to conditions which may foster conflict.


Inducements from third parties are acceptable with respect to a service we provide to you if it is disclosed to you and if it is the payment of a normal fee.


Personal account dealing rules are enforced for each member of staff.


A register of all gifts to staff and valued in excess of £25 is maintained and approved by a senior manager.



Where we are unable to resolve a conflict of interest we will notify you formally in writing. This disclosure will permit you to evaluate whether it is appropriate to continue using our services in respect of the pertinent conflict.


Where we have examined the conflict of interest and its cause it may inform you of its decision not to act on your behalf if it determines no other course of action is possible.

Appendix 4



All defined terms highlighted in Appendix 4 relate to Appendix 4 only and should not be taken as defined terms in the full scope of the Agreement.


To help us provide our services to you we have entered into an agreement with Pershing Securities Limited (“PSL”) under which PSL provides clearing and settlement, safe custody and other associated services to our clients (the "PSL Agreement”) in order to carry out the investment transactions we execute or arrange for our clients and to hold the related investments and cash. When we consider it necessary or desirable in connection with our services to you, we may agree with PSL that it will also provide other services, such as investment dealing services, under the PSL Agreement. The PSL agreement covers both us and you as one of our clients. Please note that any terms set out in bold in these terms of business are described further in the Glossary which is set out in Annex 1 to these terms of business.


PSL is a company registered in England, company number 2474912. Its registered office is at Capstan House, One Clove Crescent, East India Dock, London E14 2BH. PSL is authorised and regulated by the Financial Conduct Authority (“FCA”) which is located at 12 Endeavour Square, London E20 1JN. PSL is also a member of the London Stock Exchange (“LSE”).


So that you can understand your rights and obligations in relation to the PSL Agreement, the main terms of the PSL Agreement which affect you are summarised below. If you have any questions about the PSL Agreement or these terms of business you should contact us to discuss this as soon as possible, and before you accept these terms of business or instruct us to act for you. As with any agreement or contract, you should also take any independent, legal, financial or other advice which you think you need before accepting these terms of business.


By accepting these terms of business, you agree that:

  • (a) we are authorised to enter into the PSL Agreement on your behalf, acting as your agent;

  • (b) accepting these terms of business means that there is a contract between you and us and also between you and PSL. As a result of that contract, you will be bound by both our terms of business and the PSL Agreement (as set out or summarised below);

  • (c) we may give instructions to PSL on your behalf as allowed by our terms of business and the PSL Agreement and may provide information about you to PSL. When PSL receives such instructions or information from us, PSL is entitled to rely on them without making any further checks or enquiries; and

  • (d) PSL is authorised to hold cash and investments on your behalf and can transfer such cash or investments from your account to meet your settlement or other obligations to PSL.


When you read these terms of business, it is important you understand that you will be a client or customer of ours, but you will also become a client of PSL for settlement and safe custody purposes.


We retain responsibility (including responsibility for complying with any related regulatory requirements) and PSL shall not have any responsibility for the following matters:

  • (a) our own operations;

  • (b) the opening of an account for you;

  • (c) the supervision and operation of your account for you;

  • (d) our ongoing relationship with you;

  • (e) making all necessary anti-money-laundering compliance checks;

  • (f) explaining to you the types of investments covered and any risks relating to investments, investment transactions or any investment strategy to be pursued on your behalf;

  • (g) accepting and executing orders for investment transactions, following your instructions or within the mandate given by you;

  • (h) any required assessment of the suitability or appropriateness of transactions and investments for you or, where permitted and necessary, warning you of any possible inappropriateness of an investment;

  • (i) if required, providing any investment advice to you or taking investment management decisions on your behalf;

  • (j) reviewing your accounts for market abuse, insider trading and compliance with FCA Rules and any other applicable legal and regulatory requirements to which we or you may be subject; and

  • (k) giving instructions to PSL which are proper, accurate and in accordance with any instructions or mandate you give us.


It is important that you understand that PSL is not responsible to you for the matters for which we are responsible. In particular, PSL will not provide investment advice nor will it offer any opinion regarding the suitability or appropriateness for you of any particular transaction or order. When it provides settlement and clearing or safe custody services, executes transactions or provides other services to you, it does so relying on the instructions and information we provide and is only responsible for following those instructions.



For the purposes of the rules of the Financial Conduct Authority (“FCA Rules”), you will be classified as either a private client, professional client or a market counterparty. PSL will rely on information received from us in relation to your status and will adopt the same client classification for you. We will notify you in writing if there is any change to this position.


If you hold an account jointly or otherwise hold assets jointly, with any other person, then you and any such other person(s) shall have joint and several liability to PSL. Examples of situations where such joint and several liability may arise are as follows:

  • (a) Joint account holders: As well as joint account holders being jointly and severally liable in the way described above, any payment or accounting made by PSL to any one or more of those account holders will be treated as made to all of them.

  • (b) Trustees: As well as the trustees of any trust being jointly and severally liable to PSL in the way described above, PSL will treat the trustees as its client and not any beneficiary of the trust. Any payment or accounting made by PSL to any one or more of the trustees will be treated as made to all of them.

  • (c) Partners: If a partnership is PSL’s client then each partner will be personally, jointly and severally liable to PSL in the manner described above. Any payment or accounting made by PSL to any one or more of the partners will be treated as made to all of them.

  • (d) Agents: If you are an agent acting on behalf of someone else (whether or not that person (the “Principal”), has been identified to PSL as the person for whom you act) you will be treated as PSL’s client under the FCA Rules and you will also be fully liable to PSL under these terms of business as if you were acting for yourself. You and your Principal will be jointly and severally liable in the manner described above.



PSL will open and maintain accounts on its books in your name in order to provide its services to you. When PSL receives any cash and investments from you, or on your behalf, then it will record them in your accounts.


PSL will have the right at its absolute discretion to stop providing services under these terms of business and close any accounts it holds and maintains in your name which may occur, for example:

  • (a) if PSL is obliged to stop providing services under any applicable law or regulation (such as anti-money laundering provisions);

  • (b) if PSL is not able to provide the services effectively or providing the services would materially adversely affect PSL’s operation;

  • (c) where you are in material breach of these terms of business or we are in material breach of the terms of the PSL Agreement;

  • (d) if providing the services to you or to us in relation to your account will have a materially adverse effect on PSL’s reputation; or

  • (e) if your liabilities in relation to your account, and amounts owing by you to PSL, exceed or are likely to exceed the value of the cash and investments PSL holds for you.


We will notify you if PSL chooses to exercise this discretion and the reasons for its decision unless we or PSL are prevented from doing so by some legal or regulatory constraint.


You may at any time when there are no outstanding obligations owed by you to PSL, give notice in writing to us to stop receiving services from PSL and close your accounts with PSL.


If either you or PSL decide to close your accounts with PSL you will need to give instructions on the future custody of your investments so that PSL can transfer your money and investments (after deducting amounts owed to it) to your new custodian.



PSL will only accept instructions for your accounts from us and not directly from you.


PSL may rely on and act on any instructions which PSL in good faith believes were given by us or our representatives. Such instructions can only be cancelled or changed if we give written notice to PSL sufficiently in advance to enable PSL to prevent the processing of the instructions. If PSL seeks instructions from us and we do not respond within a reasonable time, then PSL may take such action as it considers appropriate on the relevant matter. PSL is not responsible or liable to you for any delays or inaccuracies in the transmission of instructions or other information (or any resulting action or failure to act) where that delay or inaccuracy is as a result of factors outside the reasonable control of PSL. This means that if the delay or inaccuracy is not PSL’s fault, then you cannot obtain redress from PSL.


There may be circumstances where PSL refuses to accept any order or other instruction for your account. For example, PSL may do so for any of the reasons set out in paragraphs 3.2(a) (e) above or where:

  • (a) the transactions falls outside the dealing criteria that PSL applies;

  • (b) PSL cannot carry out the instruction because it cannot access a market; or

  • (c) we or PSL do not have the necessary FCA permission to deal in a particular investment.

We will inform you if PSL refuses to accept an instruction and the reasons for its decision unless we or PSL are prevented from doing so because of any legal or regulatory constraint.


If you have any questions or concerns relating to your account with PSL, you should tell us and we will deal with PSL on your behalf. You should not contact PSL directly.


All communications whether written, spoken, electronic or in any other form between you, us and/or PSL shall be in English.



Normally we will be responsible for executing any order or transaction on your behalf. This means that PSL will not owe you a duty of best execution under the FCA Rules or otherwise when it carries out transactions executed by us on your behalf. We shall be responsible for ensuring best execution and for any decision to aggregate transactions for you with those of other people.


We may sometimes agree with PSL that it is to execute transactions for your account when we transmit orders to it. If we do this, we have agreed that, rather than you, we will be PSL’s client for the purposes of the FCA Rules. In order for PSL to provide dealing services for your account, you need to ensure that:

  • (a) where you are buying investments, there is sufficient cash in your account; and

  • (b) where you are selling investments, documents of title or transfer forms that are required are delivered to PSL,

in either case, prior to the execution of the transaction by PSL.


PSL will provide dealing or execution services on the following basis:

  • (a) execution by PSL will be subject to the FCA Rules and the rules of any investment exchange or other trading facility on which the transaction is executed;

  • (b) PSL will treat the instructions we give them as binding on you. Any express instruction from us to PSL on your behalf concerning order execution will override PSL’s order execution policy and will remain binding on you;

  • (c) PSL will execute such orders in accordance with PSL’s order execution policy as amended from time to time, a summary of which is set out on in PSL’s website on www.pershing.co.uk under “compliance disclosure”. By your acceptance of these terms of business, you confirm your consent to the execution policy and acknowledge that it may be amended from time to time. You also agree that PSL may execute transactions on a market that is not a regulated exchange or multilateral trading facility in the European Economic Area. Please note however the provisions of Annex 3 in relation to any overseas investments;

  • (d) PSL may combine your orders with orders for its other clients or PSL’s own orders. PSL will only do this if it considers that it is unlikely to work to the overall disadvantage of you or any of its clients involved however it is possible that aggregating orders in this way may sometimes operate to your advantage and sometimes to your disadvantage by giving you a higher or lower price than might have been the case if your order had been placed individually; and

  • (e) once PSL executes any transaction on your behalf, PSL will, unless you previously instructed us otherwise, send a contract note to you. It is very important that you check the detail of all contract notes you receive, and notify us (and not PSL directly) immediately if there is any error or if you have any question about them, because the contract note will be considered a conclusive and final record of any detail contained in it, unless we notify PSL of an error within 1 working day after receipt by you and in any event no later than the settlement date for the transaction concerned.



When transactions are undertaken on your behalf, they will be due for settlement in accordance with market requirements and the relevant contract note or advice. These settlement terms will vary dependent upon the market and securities dealt in. The contract note will specify the settlement date.


As stated above, it is your responsibility to ensure that PSL receives the necessary investments, documents or cash (as the case may be) in order for PSL to settle the transaction on your behalf. PSL must receive any cash in cleared funds in sufficient time prior to the settlement date in order that it can make the necessary payment.


You hereby undertake that any cash or investments held by or transferred to PSL by you will be free from any right of a third party to make claims against that money or those investments. In particular, it is your obligation to make sure that no other person will be entitled to:

  • (a) security rights over them, such as a mortgage or a charge;

  • (b) any right to withhold or retain them, such as a lien;

  • (c) any other rights to have any of the cash or investments paid or transferred to them or to prevent any transfer of such cash or investments from going ahead; or

  • (d) any right to be paid all or any of the proceeds of a transaction;

  • (e) so that settlement on your transaction can take place.


In order to settle transactions on your behalf, PSL will need to deal with the other party to the transaction (the “counterparty”). If a transaction has to be settled through a CCP or CSD the specific provisions set out in Annexes 2 and 3 shall apply.


You agree that you will not have any rights to cash or investments which are due to be received by you following a transaction until you have performed your own obligations in relation to that transaction and PSL has been able to settle that transaction on your behalf. Similarly, PSL has no obligation to account to you for any such cash or investments until you have performed your obligations and the transaction has been settled. Until that has happened, PSL is entitled, without giving you any further notice, to sell or otherwise dispose of any such investments and apply the proceeds or any cash it receives in relation to the transaction in order to discharge or reduce any of your obligations in relation to the transaction.


PSL is not obliged to credit any cash or investments it receives to your account until it has received them in irrevocable and unconditional settlement of the relevant transaction without the sender being able to reverse the settlement or require redelivery. If for any reason PSL does credit cash or investments to your account earlier than this and PSL reasonably considers that irrevocable and unconditional settlement is unlikely to take place then PSL will be entitled to reverse the entry and require you to give back or redeliver the cash or investments or their equivalent.


In some cases, transactions will be subject to netting. You agree, in respect of any transaction which is subject to netting, to discharging the settlement obligations on a net basis in accordance with the rules of the relevant central counterparty ("CCP"), central securities depository ("CSD") as defined in Annex 1 (the glossary) or agreement with the counterparty. You acknowledge that if net settlement takes place then PSL will only be obliged to account to you for any investments or cash in connection with the transaction on a net basis.


If a transaction is undertaken on your behalf on non-UK markets, the specific provisions set out in Annex 3 shall apply.


Transactions executed on your behalf may settle in the books of a CCP, CSD or other body or custodian combined with transactions for the account of other clients of ours. If this happens then PSL will allocate between our clients the cash or investments received by it or on its behalf as a result of the settlements in accordance with the client trades we have notified to it. If PSL receives cash or investments for trades that were intended to settle at the same time (but which, for whatever reason, do not do so), then PSL will allocate that cash or investments received by it on the following basis:

  • (a) in accordance with any priority for settlements determined by PSL prior to the transactions taking place;

  • (b) if transactions have the same priority, then the allocation will be in order of time, by reference to the intended settlement date of the transaction which we specified to PSL, so that the earliest in time will settle first in each case;

  • (c) where transactions have the same priority and intended settlement date, then the allocation will be by value so that the larger or largest trade by value (not by number of units or size) will be settled first in each case.

  • (d) where these allocations are necessary, they will also be subject to the operation of the relevant CCP, CSD, custodian or other entity. Such operations may include a netting rule or practice, automatic splitting of unsettled transactions or other automatic aggregation, splitting or allocation.


Time shall be of the essence with respect to any payment, delivery or other obligation of yours to PSL.



Money held by PSL for your account, will be held in compliance with the FCA Client Asset Rules when these apply to the money. This means, amongst other things, that PSL will hold your money in a special designated client bank account which is an account kept separate from PSL’s own funds.


When considering where that client bank account should be, PSL will exercise due skill, care and diligence and will periodically review the adequacy and appropriateness of any bank or credit institution where your money is deposited and of the arrangements for holding your money. These requirements will not apply where your money is held with a central bank of a country. It is important to note that PSL is not responsible for any acts, omissions or default of a credit institution or bank chosen by it but only for taking care in its choice and monitoring.


When PSL holds your money in a client account it may be pooled with money belonging to other clients of PSL. Where funds are pooled in this way, you will not have a claim for the specific sum in a specific account. Your claim would be against the client money pool in general and if there is a deficiency in the pool you would share pro rata in that loss.


If PSL holds money which is not immediately required to settle an investment transaction, such money will be deposited with a bank or credit institution, together with other clients’ money. Money may earn interest at a rate determined by the relevant bank or credit institution. However, the amount of any interest on money that would be credited to your account and made available to you (subject to clauses 11 and 12.3), will be determined by PSL and us, and will be as notified by us to you from time to time. Any interest will be calculated on a daily basis and credited to your account every six months. PSL may decide not to credit to your account such amount of the interest until it reaches a minimum threshold amount as agreed between us and PSL.


If any of your money held by PSL is unclaimed after a period of six years, PSL may cease to treat that money as client money and may include it as part of its own assets. PSL will only do this after it has taken reasonable steps to trace you and return any balance to you. If you then later show a valid claim for the money to PSL, it may then pay you any amount owed to you.


Sometimes we or PSL will undertake a transaction for you which requires your money or investments to be passed to a Relevant Party in order to meet the obligations under that transaction or as Margin or Collateral. When a Relevant Party is involved then any money or investments passed to the Relevant Party may be at risk in the event of its insolvency. By accepting these terms of business, you acknowledge that this is the case.


Please refer to the provisions of Annex 3 which will apply if your money is held by a credit institution or bank outside the UK or EEA.


PSL may use a bank which is affiliated to PSL to hold client money on your behalf.



Subject to clause 8.2, where PSL holds investments for your account it will register those investments in the name of a nominee company controlled by PSL or by a member of PSL’s group.


In some situations, for example where the rules of a particular market or CSD require, PSL will register your investments in the name of an Eligible Custodian. PSL will not usually register investments in your name but if it is required to do so, you shall remain responsible for the consequences of any such registration.


If your investments are held overseas the provisions of Annex 3 shall apply.


When your investments are held by a depository or an Eligible Custodian, such depository or Eligible Custodian may have rights against your investments, which may include:

  • (a) security rights over them including but not limited to a mortgage or charge;

  • (b) rights to withhold or retain them, such as by way of a lien;

  • (c) other rights to have the asset paid or transferred to them or to prevent a transaction involving such asset from going ahead; and/or

  • (d) rights to be paid any or all of the proceeds of a transaction involving the asset.


PSL shall keep a record of your entitlement to your investments in situations where PSL or an Eligible Custodian (or a nominee company) have registered or recorded your investment in a combined account or pooled in some other way with investments belonging to other clients of ourselves, of PSL or of the Eligible Custodian. In such a situation you should note the following effects:

  • (a) your individual entitlements may not be identifiable by separate certificates, physical documents or equivalent electronic entries on the register;

  • (b) if there is an irreconcilable shortfall following any loss by or default of, PSL or the Eligible Custodian (or a nominee company) then you may not receive your full entitlement and may share in any shortfall on a pro rated basis with any other investors;

  • (c) sometimes PSL will receive investments or money on behalf of more than one client in connection with pooled holdings (for instance in a bonus or rights issue or takeover). In such circumstances PSL may, in accordance with FCA Rules, allocate such investments between clients on whatever basis it considers fair and reasonable in accordance with its allocation policy in force at the time;

  • (d) if a share issue or other corporate event favoured the small investor your actual allocation may be less than it would be if your investments were registered in your own name; and

  • (e) sometimes amounts or investments may arise which would not have arisen if the investments had been registered in your own name. You may not be entitled to any such additional amounts.


Any instructions you wish to give about the administration of investments held by PSL should be given to us in writing for us to send to PSL. We will not accept instructions from anyone but you and will not send instructions to other people on your behalf unless in either case you have previously provided us with a copy of a valid power of attorney authorising us, or the relevant person, to send such instructions.


PSL will inform us of any rights issues, takeover offers, capital reorganisations, conversion or subscription rights (collectively “corporate actions”) that affect or relate to investments held on your behalf by PSL or an Eligible Custodian. It will do so as soon as reasonably practicable after receiving notice of those events. We will, in turn, inform you.


You should contact us and not PSL if you need any advice in connection with any corporate actions. PSL is not responsible for taking decisions in relation to any corporate actions and will require instructions from you or us on matters such as:

  • a) exercising conversion and subscription rights;

  • (b) dealing with takeovers or other offers or capital reorganisations;

  • (c) exercising voting rights (where PSL exercises such rights on your behalf).


If any notification is given to you pursuant to clause 8.7 from PSL, you must ensure that you provide instructions to us, for onward transmission to PSL in sufficient time to ensure that PSL is able to act upon such instructions. The instructions given, their consequences, and the consequences of failing to give us instructions, will be entirely your responsibility. Neither we nor PSL is obliged to do more than give one notification on the relevant matter.


PSL will be responsible for claiming and receiving dividends, interest payments and other entitlements automatically arising in respect of the investments held for your account.


Sometimes PSL or an Eligible Custodian who is holding your investments may receive dividends, interest and other rights or payments after local withholding or similar taxes or other deductions are made from those sums. You accept that PSL or any Eligible Custodian may, if it is required to do so to comply with legal or regulatory requirements, withhold or deduct tax or other amounts from any such payments. Any costs PSL or an Eligible Custodian incurs when complying with these obligations may be deducted by PSL from your account. If you are eligible to reclaim any such withholdings or deductions then this will be your responsibility and not that of PSL or an Eligible Custodian, to do so.


PSL will send you an annual safe custody statement of the investments and cash balances it holds for you, reported on a settlement date basis.


In some circumstances PSL may refuse to hold any investment or investments for you. This may occur in any of the circumstances outlined in clause 3.2 of these terms of business or if the investment concerned is of a kind for which PSL does not have facilities, or arrangements with appropriate Eligible Custodians, to hold or if holding the investment would expose PSL to liabilities. We will notify you if PSL chooses to exercise this discretion unless legal or regulatory constraints prevent such disclosure.


PSL will not loan your investments or use them to raise finance unless you have entered into a separate specific written agreement with PSL allowing such use of your investments.


If investments are comprised within a wrapper (for example, Self Invested Personal Pension plans or insurance linked investment bonds), PSL may act as custodian for the product provider. By accepting these terms of business, you grant authority to PSL to provide information to the product provider and to take such action in relation to your investments as PSL may be required to under the arrangements that have been agreed with us or the product provider.



If you fail to pay cash or investments (as relevant) when due to meet any settlement obligations or if you otherwise fail to meet any of your other obligations to PSL then you should be aware that there will be certain consequences as a result of such failure, as further described in the remainder of this clause 9.


You will not have a right to title or interest in any cash or investments received for your account. PSL will have no obligation to deliver or account to you for any such cash or investments and PSL will be entitled to retain any such cash or investments until such time that you have met your obligations.


PSL may, without providing any advance notice, use any cash, or sell any securities, held or received for your account and use the proceeds (after deducting any costs in doing so) to eliminate or reduce any unpaid obligations owed to PSL. Any surplus remaining after discharging the obligations owed to PSL will be paid to you. If the cash and proceeds of disposals do not cover all the obligations owed to PSL, you will still owe PSL the balance.


PSL may, among other things, and without giving you further notice:

  • (a) enter into any other transaction (including those with the effect of closing-out a position, or reversing or cancelling a transaction previously entered into);

  • (b) take or refrain from taking further action which it considers would, or could, reduce or eliminate any liability under any transaction undertaken for you. PSL may take similar action where it reasonably considers that you have not, or are unlikely to perform your obligations under these terms of business.


Where PSL exercises its rights to use your cash or dispose of your investments under clause 10.3 above, it will have no further obligation to you (and neither you nor we will have any right to require PSL to account to you, or to anyone else, for any investments or cash received when the relevant transaction is settled.


You agree that PSL may set off transfer or apply (without further notice to you) any obligations or monies owed by PSL to you in order to satisfy in whole or in part any debt or obligation or sum that is due from you to PSL. This applies even if the obligations are in different currencies and includes the payment of any fees or charges due to PSL and any amounts due under your indemnity obligations to ensure PSL does not lose money as a result of your default under these terms of business or the services it provides you with.


In exercising its rights under these terms of business PSL may convert currencies and carry out foreign exchange transactions with you or on your behalf at such rates and in a manner that PSL may in its discretion determine. In such circumstances, PSL shall be acting on its own behalf and not executing your orders. It shall therefore not be liable to you for the result obtained, nor for its choice of which investments are to be sold.


The provisions in this clause 9 will continue to apply even if we or PSL stop providing services to you, so long as any obligations for your account remain outstanding. They apply in addition to any other right PSL has, and they will not be affected by any failure by PSL or anyone else to fully enforce their contractual rights, whether as to payment, time, performance or otherwise.



The liability of PSL (and where relevant its directors, employees or agents) to you for any loss or damage which you suffer in connection with these terms of business shall be limited to circumstances where any such loss or damage has arisen directly as a result of negligence, fraud or wilful default or a breach of the FCA Rules by PSL (or where relevant, its directors, employees or agents). In any event, PSL will not be liable to you for any indirect or consequential losses (howsoever arising). PSL will also not be liable for any loss that is a loss of profit or for any losses that arise from any damage to your business or reputation.


This means that PSL will only be liable for losses that arise as a result of its negligence, fraud or wilful default and then only, for any losses which:

  • (a) arise naturally from a breach by PSL of its obligations PSL Breach; and

  • (b) which were reasonably foreseeable to PSL at the time these terms of business are entered into.


It is important that you understand that you are responsible for making sure that PSL does not suffer by reason of acting for you. You agree to make good and reimburse (indemnify) PSL and each of its directors and employees and agents (“Indemnified Persons”), after the deduction of any applicable taxes, for and against any liabilities, reasonable costs and expenses (including legal costs) and all duties and taxes (other than PSL’s corporation tax) which are caused by;

  • (a) PSL providing its services to you;

  • (b) material breach by you of any of these terms of business;

  • (c) default or failure by you to make a delivery of investments or payment when due; or

  • (d) any challenge to the validity of, or requirement for proof or ownership, or in respect of any fraud or forgery in relation to any investments delivered to PSL by you or on your behalf, or in relation to any document of transfer regarding such investments. This will include any electronic instruction or information, which appears to transfer such investments.


You will not be liable to indemnify PSL under this clause 10 and PSL will have no right or claim against you or us if any consequences to PSL are caused by its own negligence, wilful default, fraud or any breach of the FCA Rules.


PSL has no liability to you or us for failure to provide any of the services under these terms of business if that failure is caused wholly or partly by events beyond PSL’s reasonable control. This includes (but is not limited to) any failure of communication, settlement, computer or accounting system or equipment, any failure or interruption in the supply of data, any political crisis or terrorist action, suspension or limitation of trading by any exchange or clearing house or any fire, pandemics, flood or other natural disaster. In any of these (or other similar) circumstances any or all of PSL’s obligations will be suspended until the state of affairs giving rise to the failure of PSL is remedied.


The provisions in this clause 10 will continue to apply even if we or PSL stop providing services to you. They apply in addition to any other right of indemnity or claim of any Indemnified Person whether or not under these terms of business, and they will not be affected by any failure by PSL or anyone else to fully enforce their contractual rights, whether as to payment, time, performance or otherwise.



The fees and charges payable by you in relation to the services provided by PSL (in particular, the money management fee), and any taxes payable through PSL, will be set out in our charging schedule (see Appendix 5 to this agreement) and as notified to you from time to time. PSL can either deduct these out of the assets and money it holds for you for your account or by way of set off as described at clause 9 above or require you to pay them directly to PSL or to PSL through us. You may also be liable for other taxes or charges which are not payable through PSL.



PSL, its associated group companies (associates) or nominees may provide services or enter transactions under these terms of business in circumstances in which PSL or its associates have a material interest. This interest could be direct or indirect and PSL or its associates could also have a relationship with someone else, which may involve a conflict of interest or potential conflict of interest with you. Examples where such actual or potential conflicts may happen include situations where PSL or any of its associates:

  • (a) is, or is acting on behalf of, the counterparty to a transaction that is executed by PSL (whether or not involving a fee or commission or increased or reduced price offered or received by PSL or its associates);

  • (b) has a long or short position in the relevant investment

  • (c) is the financial adviser to the issuer of the relevant investment; or

  • (d) is otherwise connected to the issuer of the investment to which any instructions relate.


PSL may receive payments from fund managers if PSL provides services to those fund managers through the PSL Nexus Funds Trading Platform. Any payments of this kind are calculated by reference to the value of the assets that PSL holds in custody for its clients.


PSL may place money held for your account with a bank or other financial institution (in accordance with the FCA rules) and earn interest and retain some or all of that interest from that bank.


A summary of PSL’s conflicts policy (including further disclosure concerning the payments PSL may receive from fund managers) is published on PSL’s website at www.pershing.co.uk under the heading of “compliance disclosures” (a hard copy is available on request from us).


You acknowledge that neither PSL nor any of its associates is required to disclose or account to you for any profit made as a result of acting in any manner described above.



PSL may store, use or otherwise process personal information about you which is provided by you or us on your behalf. The purposes for which it can store, use or process such personal information are providing investment and other services under these terms of business, administering your account and other purposes closely related to those activities. This includes (but is not limited to) using information for the purposes for credit and anti-money laundering enquiries or assessments. In the United Kingdom PSL operates and has made all the appropriate notifications in accordance with applicable data protection legislation.


Any information that we and PSL hold about you is confidential to you and will only be used in connection with providing services under these terms of business. Information of a confidential nature will be treated as such provided that such information is not already in the public domain. PSL will only disclose your information to third parties in the following circumstances:

  • (a) If required by law or if requested by any regulatory authority or exchange having control or jurisdiction over us or PSL (or any associate of us or PSL);

  • (b) to investigate or to prevent fraud, market abuse or other illegal activity;

  • (c) in connection with the provision or services to you by us or PSL;

  • (d) for purposes closely related to the provision of the services or the administration of your account including without limitation for the purposes of credit enquiries or assessments;

  • (e) if it is in public interest to disclose such information; or

  • (f) at your request or with your consent.


The restrictions on the use of confidential information described above are subject at all times to a general proviso that PSL may disclose your information to certain permitted third parties including members of its own group (associates) and its professional advisors (including accountants and lawyers) who are subject to confidentiality codes.


Neither we nor PSL will sell rent or trade your personal information to any third party for marketing purposes unless you give your express consent.


You should note that by signing or otherwise accepting these terms of business you agree that PSL is allowed to send your information internationally including to countries outside the EEA such as the United States of America. Some countries where your information is sent will offer different levels of protection in relation to personal information, not all of which will be as high as the UK. PSL will however, always take steps to ensure that your information is used by third parties only in accordance with PSL’s policy.


You are entitled to a copy of any information PSL holds about you. In the first instance, you should direct any such requests to us and we will pass your request on to PSL. PSL is entitled to by law to charge a fee of £10 to meet the cost of providing you with details of the information it holds about you. You should let us know if you think any information PSL holds about you is inaccurate and we will ask PSL to correct it.



If you have a complaint you should notify our compliance officer in the first instance. If however, your complaint concerns an aspect of the service provided to you by PSL and you wish to copy your complaint to PSL directly copies should be sent to:

The Compliance Officer
Pershing Securities Limited
One Clove Crescent
East India Dock
E14 2BH


Where you make a complaint both we and PSL will endeavour to resolve your complaint as quickly as possible but in any event we will acknowledge receipt of your letter within 5 business days. The acknowledgement sent will include a full copy of our or PSL’s internal complaints handling procedure. Upon resolution of your complaint we or PSL will send you a final response letter, which sets out the nature of our response of any proposed resolution, and any appropriate remedy. If for any reason you are not satisfied with our or PSL’s final response please note that you may be entitled to refer your complaint to the Financial Ombudsman Service. A leaflet detailing the procedure is provided in our or PSL’s final response.



PSL is covered by the UK’s Financial Services Compensation Scheme (“FSCS”). Compensation may be available from the FSCS if PSL cannot meet its obligations to you. Your possible entitlement to compensation will depend upon the type of business and the circumstances of the claim. Most types of investment businesses are covered for 100% of the first £50,000. Further information about compensation arrangements is available from the FSCS, www.fscs.org.uk.



PSL reserves the rights to alter these terms of business at any time. It will only do so after giving prior written notice to us in reasonable time for you to consider the impact of those changes, unless it is impractical in the circumstances to give such notice.



PSL’s obligations to you are limited to those set out in these terms of business. PSL shall in particular not owe any wider duties of a fiduciary nature to you.


No third party shall be entitled to enforce these terms of business in any circumstances.


Any failure by PSL (whether on an ongoing basis or not) to insist upon strict compliance with any of these terms of business is not deemed to amount to PSL giving up or waiving any of any of its rights or remedies under them. The rights and remedies conferred on PSL will be cumulative and the exercise or waiver of any part of them will not stop or inhibit the exercising by PSL of any other additional rights and remedies.


These terms are governed by English Law and you irrevocably agree to submit, for the benefit of PSL, to the non-exclusive jurisdiction of the Courts of England.



Business Days

This means any day on which the London Stock Exchange is open for trading


This stands for central counterparty, which is typically an institution that acts as an intermediary between two market participants. The seller of a security sells to the central counterparty. The central counterparty simultaneously sells to the buyer. This means that if one party defaults then the central counterparty will absorb the loss. This reduces the amount of counterparty risk that market participants are exposed to.

Certain markets that PSL trades in on your behalf will involve a CCP and such transactions will be subject to the rules of the CCP.


A charge does not involve a transfer of ownership but gives a degree of control to a third party over any dealing or disposal of the asset.

Clearing and Settlement Services

The process by which, once an investment has been bought or sold on your behalf, the money is transferred from the buyer to the seller and the investments or the title to the investments is transferred from the seller to the buyer.


This stands for central securities depository which is a financial institution that custodies securities and provides securities settlement services to one or more markets.

When settling a transaction on your behalf PSL may have to settle such transaction through a central securities depository or other securities settlement system and the transactions will be subject to the rules of the CSD.

Dealing or Execution Services

Dealing or Execution Services The buying or selling of investments on your behalf.

Eligible Custodian

This refers to a third party custodian (or its nominee company) who PSL selects under the FCA Rules to register your investments with.

Joint and Several Liability

If joint and several liability applies, the effect is that both you and the other person(s) separately promise to meet all obligations under these terms of business in respect of the account either (1) jointly with the other person(s); and (2) individually.


A Lien allows the person holding the asset to withhold or retain such asset pending the satisfaction of your obligations to them.

Margin or Collateral

This is where your money or investments are passed to a Relevant Party in order to provide security against the performance of obligations.


A mortgage transfers the ownership of an asset to a third party on the condition that it will be re-transferred on the discharge of the obligations owed to that third party.


Netting is the process under which PSL and/or the counterparty, CCP, CSD or other body concerned with settling a transaction are entitled to reduce their obligations to each other by setting off their obligations to deliver cash or securities to one another. This will give a single amount owing to one party from the other rather than a two-way payment. This single amount will then be paid or delivered to the relevant party.

Nominee Company

A nominee company is one which is used solely for holding investments separately and which does not carry on any other business.

Relevant Party

This includes (but is not limited to) an exchange, clearing house, intermediate broker, settlement agent or a counterparty dealt with directly (over the counter) outside of any exchange. The Relevant Party may be located in the UK or elsewhere.

Safe Custody Services

The safekeeping and administration of any investments held by PSL or its nominee company on your behalf.


This may arise where both you and PSL owe sums to each other. In such circumstances PSL may deduct any sums owed to it by you from any sums that are owed by PSL to you so as to either eliminate or reduce PSL’s liability to you.

Time shall be of the Essence

The use of this term in relation to any payment, delivery or other obligation you have to PSL means that PSL shall be entitled to terminate these terms of business and, if appropriate, claim damages from you if you fail to perform your obligation in accordance with the time specified. It is intended to ensure that the relevant deadlines are strictly complied with.





In order to settle transactions on your behalf, PSL will need to deal with the other party to the transaction (the “counterparty”) and sometimes transactions will be settled through a central counterparty (“CCP”) or a central securities depositary or other securities settlement system (“CSD”) or other depositary transfer agent or similar body. When PSL deals with these parties, it does so as your agent, in good faith and on the basis that:

  • (a) PSL is not responsible for any default or failure of the CCP, CSD or other counterparty or of any depositary or agent of those entities; and

  • (b) the delivery of any securities or payment to you as a result of the transaction is entirely your risk and not that of PSL.


In some cases, transactions will be subject to netting. You agree, in respect of any transaction which is subject to netting, to discharging the settlement obligations on a net basis in accordance with the rules of the relevant CCP or CSD. You acknowledge that if net settlement takes place then PSL will only be obliged to account to you for any investments or cash in connection with the transaction on a net basis.


We and you acknowledge and agree that:

  • (a)PSL does not owe any duty to us, you or any other person to verify the appropriateness, adequacy or effectiveness of the rules, requirements and procedures of any market or CCP; or in relation to any exercise or non-exercise by the market or the CCP of its rights or powers under such rules, requirements and procedures; and

  • (b)PSL shall have no liability for any loss or damage suffered or incurred by us or you by reason of PSL taking or failing to take any action, where such action or failure to take action is authorised, permitted or required by a market or a CCP or is otherwise deemed necessary by PSL under the rules, requirements and procedures of the market or the CCP.



If any net settlement takes place then PSL’s only obligation to account to you will be to account for the net investments and/or cash received by it from any relevant CCP, CSD, or their respective agents, corresponding to the transactions relevant to the net settlement entered into on your behalf. In addition you agree that PSL shall have no liability to you in connection with the exercise by any CCP, CSD, or their respective agents of their powers under any Power of Attorney or equivalent right or power in respect of any settlement account operated by or on behalf of PSL in connection with the settlement of any transaction.





If a transaction is undertaken on your behalf on non-UK markets, it will be subject to the rules of the relevant overseas exchange, clearing system and/or depositary and to any terms of any foreign agent or custodian employed by PSL. These rules and terms may include, but are not limited to, such persons having the right to reverse a transaction (including reversing the delivery or re-delivery of any investment and any payment) even after it has been settled. In view of the number of markets and counterparties which may be used it is not possible to outline all of the potential rules and obligations that may apply in such cases.



If your money is held by a credit institution or bank outside the UK or EEA or your money or investments are passed to a third party then it is important you understand that the legal and regulatory regime applying to that credit institution, bank or other third party will be different from that of the United Kingdom or the EEA. This means, amongst other things, that the rights and protections you have under the FCA Rules will not be available in respect of those banks or credit institutions or third parties. Other rules and regulations may apply to them under local law but your rights and obligations are likely to differ, particularly if such party is in default



Whether or not they are registered or recorded in the name of PSL, or an Eligible Custodian, investments belonging to you which are held abroad may be subject to different settlement, legal and regulatory requirements from those applying in the UK or the EEA. Your rights may therefore also differ.


PSL will exercise due skill, care and diligence in the selection, appointment and periodic review of any Eligible Custodian it appoints and the arrangements for the holding and safekeeping of your investments. It is important that you understand PSL is not responsible for anything done or not done, or any default of an Eligible Custodian unless that default is caused by the negligence, fraud or wilful default on the part of PSL or any of its nominee companies. Although PSL will seek to make sure that adequate arrangements are made to look after your ownership rights in any investments (especially in the event of its own insolvency) you should understand that your investments may be at risk if an Eligible Custodian becomes insolvent.


Overseas investments may be registered or recorded in the name of PSL or in the name of an Eligible Custodian. Your acceptance of these terms indicates your consent to the possibility of registration in such manner. However any such registration in one of these ways will only be done after PSL has taken reasonable steps to determine that it is in your best interests to do so or that it is not feasible to do otherwise because of the nature of the applicable law and market practice in the jurisdiction where the transaction occurs. Registration in this way means that your investments may not be kept separate from other investments belonging to PSL or the relevant Eligible Custodian. Your protection may therefore be less, as if the person in whose name your investment is recorded defaults on its obligations, your investment may not be separately identifiable as yours. Accordingly it may be subject to other third party claims including claims by the general creditors of the defaulting person.




Our fees and charges fall into three categories:

  • (a) Annual management fees;

  • (b) Withdrawal charges; and

  • (c) Additional charges.




The fee is a percentage of your total assets under management with us. From 1 October 2013 the percentage is determined with reference to the value of your total gross contributions to your Portfolio as set out in the table below. We reserve the right to review the fee where we believe total gross contributions are being manipulated by deposits and subsequent withdrawals, or other unreasonable activity.



Annual management fee

Total gross contributions to Portfolio


1.00% (0.83% + VAT where applicable)



0.9% (0.75% + VAT where applicable)



0.75% (0.63% + VAT where applicable)



0.6% (0.50% + VAT where applicable)



0.5% (0.42% + VAT where applicable)



0.3% (0.25% + VAT where applicable)





When withdrawing either a portion or the entirety of cash from your Nutmeg account, a charge will apply based on your method of the withdrawal:




Super Express

Trade (if necessary) at next scheduled trading day + transfer of cash within 3 business days after settlement

Trade (if necessary) next business day* + transfer of cash within 3 business days after settlement

Trade (if necessary) next business day* + same day transfer of cash upon settlement (if settled by 12:00)





* For Express and Super Express withdrawals, we will endeavour to trade as quickly as possible. Generally, that means the next business day after we receive the withdrawal instruction, but it may mean the same business day for withdrawal instructions received early in the day. For instructions received after markets have closed, we endeavour to trade the next business day, but may have to trade the business day after that (2 business days after we received the instruction).




Panel on Transactions and Mergers (PTM) levy

£1 on all UK share deals over £10,000 gross consideration


Cheque processing (funds received)

£20 per cheque


Securities transfers out

£20 per stock


Hard copies of tax certificates / contract notes



Data Protection Act Subject Access Requests (SARs)



Electronic copy of a letter of certification of discretionary management services



Hardcopy of a letter of certification of discretionary management services



Additional copies of statements




  • (a) Bank of England base rate less 0.25%