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Execution policy documents: the paragraphs that actually matter

Every regulated broker publishes an order execution policy. Most people never read it. It's dry, but a few parts of it matter for scalpers.

The first is the execution model. Does the broker act as the counterparty, pass orders to liquidity providers, or a mix? Some policies describe how they decide which orders go where.

The second is slippage. Look for whether the broker applies slippage symmetrically, meaning you can get filled better as well as worse than your requested price. Some policies state this clearly. If it only mentions negative slippage, that's worth noticing.

The third is how pending orders are handled during fast markets and gaps. Stops are usually filled at the next available price, which can be far from your level. Some brokers say they may reject or delay orders in extreme conditions.

The fourth is anything about restricted trading practices. Some brokers mention latency arbitrage, high frequency trading, or abusive strategies, and reserve the right to cancel trades or adjust prices.

Finally, check whether the policy mentions minimum distances, order size limits or the times when market conditions are considered abnormal.

It's twenty minutes of reading. For someone who trades hundreds of times a month, it's useful to know the rules you're playing under.

Brokers often have different execution policies for different entities or account types, so make sure you're reading the one that applies to your account. A broker's site might link to the policy for its main regulated entity while you're actually signed up with an offshore one. The client agreement or the account opening email usually says which entity holds your account. It's a small detail, but the protections and the execution rules can differ quite a bit between entities under the same brand. Check the entity name on your account documents and read that version of the policy.

The policy is also useful if you ever need to raise a complaint about a fill. If a trade was handled in a way that contradicts the published policy, you have something concrete to point to. Without it, a complaint is just your word against theirs. Saving a copy of the policy when you open the account helps too, since brokers update these documents, and the version that applied at the time of a trade might not be the one on their site months later. A saved PDF with the date is enough, and it takes a minute to do when you open the account.

You can test the slippage paragraph against your own account instead of taking it on trust. The trade history shows the fill, but not always the price you saw when you clicked, so that part needs logging: a small script that writes requested and filled price to a file is enough, or use pending orders, where the trigger level is already known.

After a few hundred fills, sort them into three piles: better than requested, exactly at the price, and worse. If the policy calls slippage symmetric but the "better" pile stays almost empty, that is the concrete point you mention for a complaint. Keep limit entries in their own group, because a limit filled worse than its price says much more than a market order caught in a fast move.

Have you seen a policy that states a maximum slippage in pips, or do they all leave the number open?

Look for the section on how the broker handles orders during abnormal market conditions. It usually explains what happens to stops and limits during news, gaps or periods of low liquidity. Some brokers reserve the right to fill at the next available price, others might reject orders or widen spreads significantly. Knowing this in advance changes how you think about holding positions through events. The language can be vague, but even vague wording tells you how much discretion the broker keeps for itself when markets get wild. The broker's own examples, if it gives any, are the clearest part.

How often do brokers update these documents? Policies change, and brokers usually notify clients by email or a notice on the website. If you've been with a broker for years, the policy you read when you joined might not be the current one. Checking the current version once a year, or when you notice a change in execution, is a sensible habit. Some changes are minor, like updated provider lists, but others might affect order handling or the way slippage is applied in a way that matters for scalping. Saving a dated copy each time makes comparisons easy later on.