Foreign Exchange Disclosures

Deutsche Bank AG (acting through its various branches and its affiliates, “Deutsche Bank”) would like to highlight certain information to customers of Deutsche Bank’s foreign exchange (“FX”), precious metals (“PM”) and base metals (“BM”, and together BM and PM are “metals”) algorithmic and aggregation services (the “FX Algo Services”). The purpose of this disclosure is to outline Deutsche Bank’s standard business practices in providing the FX Algo Services.

In concluding transactions pursuant to the FX Algo Services, Deutsche Bank acts in a principal capacity and not as your agent. Consequently, all transactions you enter into pursuant to the FX Algo Services will be with Deutsche Bank, not the external counterparty (where applicable) from whom Deutsche Bank has sourced liquidity in the market pursuant to your order. Further details in relation to Deutsche Bank’s role and business practices in FX and metals markets more generally are described in Deutsche Bank’s Foreign Exchange Disclosure Statement, which can be found at the following link: https://www.db.com/FXdisclosures (“FX Disclosure Statement”).

FX Algo Services

For the sake of clarity, the FX Algo Services comprise the following:

• Deutsche Bank’s client algorithmic execution service (“Client Algo Execution Service”), which provides access to multiple liquidity sources in FX and metals products through the use of order types selected by you which incorporate Deutsche Bank proprietary algorithms. These algorithms make decisions around when, where and how to execute your orders, dependent on the algorithmic strategies chosen, the internal risk controls applied and the parameters specified by both Deutsche Bank and you; and
• Deutsche Bank’s FX aggregation service (“FX Aggregation Service”), which provides access to a pool of liquidity providers in FX cash and derivative products with a degree of automation. Liquidity is sourced either through the use of Deutsche Bank algorithms (for FX spot) or on a manual basis (for all other FX products).

Algo Strategies

Information in relation to the different algo strategies and order types that include algorithmic features which are available as part of the FX Algo Services (the “Algo Strategies”) can be found on the following website: mc.gm.db.com.This information can be found within the “Info” section under the heading “FX Algo Services – Algo Strategies”.

When reviewing this information, you should consider which Algo Strategies are most suited to your individual needs.

Fees

Deutsche Bank charges a fee for the FX Algo Services, calculated by reference to the volume of transactions entered into. This fee will be agreed with your Deutsche Bank sales representative.

The fee for each transaction is added to the price Deutsche Bank receives from the relevant liquidity provider(s) to generate the net price. Both the net and gross price of each transaction will be notified to you and the fee charged will be the difference between the two. Fees charged may vary depending on the Algo Strategies selected. Please note that fees for a particular client may differ to the fees charged to other clients for the FX Algo Services.

Liquidity Sources

A list of the different liquidity sources accessed by Deutsche Bank as part of the FX Algo Services can be found on the following website: mc.gm.db.com. This information is located within the “Info” section under the heading “FX Algo Services – Liquidity Sources”. Such information may also be communicated to you bilaterally by your Deutsche Bank sales representative. Should you wish to have access to only a subset of these liquidity sources, please contact your Deutsche Bank sales representative.

Where Deutsche Bank is offering access to external liquidity sources, Deutsche Bank remains principal to the trade and you will not face the liquidity provider directly.

Some liquidity providers (including Deutsche Bank) may apply price checks which incorporate a latency buffer as part of their usual trade acceptance processes. If you wish to discuss the application of a latency buffer to the trades you enter into with Deutsche Bank pursuant to the FX Algo Services, please contact your Deutsche Bank sales representative. Further details of Deutsche Bank’s trade acceptance process and price check can be found in Deutsche Bank’s FX Disclosure Statement.

Client Algo Execution Service

Deutsche Bank’s Client Algo Execution Service offers access to both internal and external liquidity sources in certain FX and metals spot and derivatives products, including deliverable and non-deliverable forwards, depending on the Algo Strategies you select. This includes sourcing liquidity from multilateral electronic matching services or systems that allow for the automated entry of orders and/or execution of trades between participants (“multilateral trading platforms”) and from liquidity providers on a bilateral basis, through bilateral electronic systems or services (which may include Deutsche Bank’s electronic FX trading desk). Certain Algo Strategies may only permit access to internal Deutsche Bank liquidity.

Where a client of the Client Algo Execution Service submits an order to roll an existing FX or metals spot position for settlement beyond standard spot settlement (i.e. >T+2), Deutsche Bank will treat the client’s order as a request to enter into a spot transaction for standard spot settlement and a related forward transaction for settlement on the specified settlement date.

If Deutsche Bank accepts such order, the number of basis points added to or subtracted from the applicable spot rate for the relevant currency pair in order to determine the forward rate to be applied to the relevant forward transaction (the “forward points”) will be sourced from Deutsche Bank’s FX Forwards desk and will be disclosed to the client following execution.

If a client wishes to dispute the forward points applied to any such order, they must do so as soon as possible (and no later than 1 hour following execution of the relevant order).

Deutsche Bank may, in its sole discretion, adjust the forward points applied to any such order if so disputed by a client, however Deutsche Bank will not be obligated to do so. There is no assurance that any FX or metals transaction entered into as described herein will be priced at better rates than it would otherwise be priced elsewhere in the market or on dates other than the specified settlement date.  

Information as to the liquidity sources accessible by each of the Algo Strategies offered by Deutsche Bank as part of the Client Algo Execution Service can be found on the website referred to in the “Algo Strategies” section of this disclosure.

FX Aggregation Service

Deutsche Bank’s FX Aggregation Service offers access to liquidity in FX cash and derivatives products from a pool of liquidity providers on a bilateral basis. Clients of the FX Aggregation Service will be aware that liquidity providers are selected pursuant to an auction process. The way in which the auction process will work is agreed separately between Deutsche Bank and you.

Use of client order information

In all cases where Deutsche Bank sources liquidity from external liquidity providers pursuant to the FX Algo Services, your identity as the client will not be disclosed to such liquidity providers. In some circumstances, the liquidity provider may know which desk within Deutsche Bank has requested the liquidity. This will depend on the manner in which Deutsche Bank interacts with the liquidity provider, as described below.

External liquidity

When Deutsche Bank trades on multilateral trading platforms, it may do so on an anonymous basis, in which case the liquidity provider will only know the identity of Deutsche Bank once the trade has been executed. If Deutsche Bank is not trading anonymously, then the liquidity provider will know that the order has come from Deutsche Bank but will not know which particular desk within Deutsche Bank has submitted the order.

When Deutsche Bank sources liquidity bilaterally, the liquidity provider will know that the order is coming from the Deutsche Bank desk(s) responsible for providing the FX Algo Services.

Deutsche Bank internal liquidity

Deutsche Bank maintains information barriers between the Deutsche Bank personnel providing the FX Algo Services and the Deutsche Bank desks which engage in traditional FX market-making business. These information barriers are established to safe guard client order information and mitigate conflicts of interest. Information barriers consist of internal written policies and procedures as well as physical and electronic separation.

If Deutsche Bank internal liquidity is sought with a respect to your order pursuant to the FX Algo Services, then:

• (i) if liquidity is sought from Deutsche Bank’s electronic trading desks via an algorithm, it will become immediately visible within Deutsche Bank’s internal electronic trading system that a client is seeking principal liquidity. Consequently, any Deutsche Bank desk with access to this system will be able to view details of the portion of the order submitted for execution against Deutsche Bank internal liquidity; and
• (ii) if liquidity is sought manually from Deutsche Bank’s market making desks, the desks within Deutsche Bank from whom liquidity is sought will be able to view details of the portion of your order submitted for execution against Deutsche Bank internal liquidity.

In each case, whether your identity as the client is visible to those persons referred to in (i) and/or (ii) above will depend on which Algo Strategy you have selected.

Access to your order information and your identity may also be made available:

• before, during and after execution to the desk(s) within Deutsche Bank responsible for the FX Algo Services, as well as Deutsche Bank’s operations and risk management personnel (including credit risk, market risk, operational risk, compliance, legal and audit);
• to Deutsche Bank sales staff more generally, if you request that they have the ability to view your orders from time to time and/or request them to enter an order on your behalf; and
• post execution, in certain internal Deutsche Bank systems that from time to time derive information from Deutsche Bank’s internal electronic trading system.

Further information in relation to how Deutsche Bank uses information contained in customer orders and transactions internally is set out in Deutsche Bank’s FX Disclosure Statement.

Routing and aggregation preferences

Deutsche Bank’s FX Algo Services determine whether and how to execute an order (in whole or in part) based upon a variety of factors, which may include consideration of the following:

• liquidity considerations (such as location of the multilateral trading platform/liquidity provider, average bid/ask, size of the order);
• execution risk (such as the availability of the liquidity, response times, latency buffer, reject rates);
• any client specific requests (if applicable); and
• the all-in cost of executing the order against a particular liquidity source.

Different liquidity pools may be selected for different Algo Strategies (for example, as determined by parameters such as the aggressiveness and duration of the relevant algorithms). In the case where a client order could have an impact on the market and/or reduce the availability of liquidity across the relevant product, different liquidity pools may apply.

Utilisation of Deutsche Bank’s FX Algo Services does not guarantee execution of the entire amount of your order. Your order may be executed by partial fills at different prices and/or against different liquidity sources. Any “odd lots” (i.e. amounts below the minimum amount tradeable on a particular liquidity source) will be directed to all liquidity sources that accept the relevant amount for execution, unless otherwise agreed between us. If Deutsche Bank has been unable to execute the entire amount of your order pursuant to the FX Algo Services, the remaining portion of your order will not be executed.

Please note, Deutsche Bank may update the contents of any websites referred to in this disclosure from time to time. Should you have any questions in relation to any of the content of this disclosure, please contact your usual Deutsche Bank sales representative.