Financial Services Guide
28th April 2023
This Financial Services Guide was published in April 2023 and issued by Capital 19 Pty Ltd ABN 17 124 264 366
WHAT IS A FINANCIAL SERVICES GUIDE?
This Financial Services Guide (FSG) is an important document. You should read it carefully and make sure you understand it. It is designed to help you decide whether to use any of the services provided by Capital 19 Pty Ltd (referred to as Capital 19, C19, we, us or our).
This FSG includes information about:
- C19 and how we can be contacted;
- The financial services we are authorised to provide;
- Who our authorised representatives are;
- How we are paid;
- Any relevant relationships or associations;
- How we deal with complaints that you may have about our services;
- Information about internal and external dispute resolution systems and how you can access them, and;
- The compensation arrangements we have in place.
ABOUT CAPITAL 19
Capital 19 provides clients in Australia with the ability to purchase listed financial products such as shares, options and futures in market centres all over the world. Our particular focus is on the largest and most liquid stock market of them all – the United States.
Acting as your agent, we will arrange the purchase/sale of securities on an applicable exchange. Capital 19 is not a participant of an exchange and will always engage an executing broker to effect transactions. These executing brokers are clearing participants or they will engage a clearing participant to settle your trades. Capital 19 has an executing broker relationship with Interactive Brokers Australia.
You can contact us via the following means
Website: www.capital19.com
Email capital19@capital19.com
Phone +61 2 9002 0360
Writing 303 / 35 Lime Street, Sydney, NSW 2000
THE FINANCIAL SERVICES WE ARE AUTHORISED TO PROVIDE
Any financial services offered will be provided by representatives of Capital 19. Capital 19 is licensed under ASIC to provide these services to you. Our Australian Financial Services License Number is 441891
Capital 19 is authorised to offer the following financial services to both retail and wholesale clients:
- Provide General Financial Products Advice
- Deal in Financial Products
Products we provide general financial product advice and deal in are:
- Deposit Products
- Derivatives
- Foreign Exchange Contracts
- Debentures, stocks or bonds issued by a government
- Interests in managed investment schemes including investor directed portfolio services
- Securities
- Standard Margin Lending Facilities
OUR AUTHORISED REPRESENTATIVES
We presently do not have any authorised representatives. All representatives are employees of Capital 19.
PROVISION OF GENERAL ADVICE ONLY
You should be aware that any advice given by Capital 19 is general advice only and does not take into account your specific needs or objectives. All of our commentary, statements of opinion and recommendations in relation to financial products have been prepared without taking into account your personal objectives, financial situation or needs. It is up to you to decide whether this is appropriate for you.
Investment in securities and the trading of derivatives involves risk. Share prices rise and fall. The payment of dividends and the return of capital are not guaranteed. Investing in overseas markets exposes you to additional risks including those related to movements in foreign currency exchange rates.
OTHER DOCUMENTS YOU MAY RECEIVE
Product Disclosure Statement
If we make a recommendation to acquire a particular financial product (other than listed securities such as listed shares or exchange traded options), we will also provide you with a Product Disclosure Statement (PDS). The PDS contains information about the particular product including the features, benefits, fees and risks associated with that product to assist you in making an informed decision.
Our executing broker, Interactive Brokers Australia, will provide you with a PDS for listed products such as listed shares or exchange traded options purchased through them.
Statements of Advice
Capital 19 will not provide a Statements of Advice, as it does not give personal financial product advice.
HOW CAN YOU PROVIDE INSTUCTIONS TO US?
You may route orders directly to Interactive Brokers Australia via their electronic trading platform – Traders Workstation (TWS).
Alternatively, you may instruct us to buy or sell investments on your behalf by phone or email. Instructions received by email will only be affected once a representative of Capital 19 has acknowledged receipt of those instructions.
All orders will be accepted on a “Good till cancelled” basis unless otherwise instructed. Stop-loss orders are only accepted on a non-guaranteed basis.
Some products in relation to which we provide financial services have their own rules about how to provide instructions or carry out certain transactions. Please refer to the PDS of the relevant product for these details.
REMUNERATION OR OTHER BENEFITS WE RECEIVE
There are a number of costs, fees and commissions that you may be required to pay us in order to use our services. These constitute remuneration to Capital 19 and are set out below:
- Trade Execution Fees
Trade execution fees are payable each time you buy or sell a financial product through us. These fees are collected by our executing broker, Interactive Brokers Australia, and remitted to Capital 19 after Interactive Brokers Australia deducts their fee for trade execution from the total fee charged to you.
For example, if you buy 700 shares of a US listed company.
Our fee for listed US shares is 2 US cents per share with a minimum of US$20. In this example, the calculation would be
700 x $0.02 = US$14
But the minimum is US$20, so the fee charged would be US$20
A complete list of our trade execution fees can be found on our website.
- Foreign Exchange
If you trade a foreign product, you might be required to convert Australian Dollars into Foreign Currency or vice-versa.
Our currency conversion fee is US$25 + 0.1% of the trade value.
For example, if you convert $20,000 AUD into USD and the current exchange rate is 0.8250 the conversion fee would be calculated as:
US$25 at the current exchange rate of 0.8250 = AUD$30.30
PLUS
0.1% of the 20,000 trade value = AUD$20
Total conversion fee = AUD $50.30
- Interest on Long and Short Cash Positions
In certain circumstances, interest may be paid to you or charged to you. Interest rates are calculated in reference to an internationally recognised benchmark interest rate. Capital 19 then applies a spread around that benchmark to calculate your effective interest rate.
Interest is calculated daily and paid/debited to your account on a monthly basis within the first week of the following calendar month. The exact amount of interest paid / received by Capital 19 will vary each day, depending on such factors as changes to the holdings in your portfolio and/or changes to the prevailing interest rate that is applied.
Applicable Interest Rates are tiered and can be found on the Capital 19 website.
Long Currency Balances
If you hold a long currency position (ie a positive currency balance) you may be eligible to earn interest on that balance. Interest is paid on a tiered structure based on the overnight cash rate of the currency country, less 2.5%. Please note that if the overnight cash rate is 2.5% or less, you will not be entitled to receive any interest. If the overnight cash rate less 2.5% is negative (eg RBA cash rate is 1.5%, less 2.5%, is -1%), then you will not be required to pay interest.
For example, if you held AUD200,000 cash in your account and the RBA rate was 4.5%, you would receive 2% per annum interest. (4.5% less 2.5%) The interest would be approximately $10.95 for every day the amount is maintained. ($200,000 x 2% = $4000 divided by 365)
Long currency cash balances can occur as the result of Margin FX trading or from unutilised funds in your account. Smaller cash balances may not be eligible to earn intertest.
Please see our website for current details of minimum cash balances required to earn interest and also current interest rates.
Short Currency Balances
If you hold a short currency position (ie a negative currency balance) you will be charged interest on that balance. Interest is charged based on the overnight cash rate of the currency country, plus 2.5%.
For example, if you were short AUD200,000 cash in your account and the RBA rate was 4.5%, you would be charged 7% per annum interest. (4.5% plus 2.5%) The interest charged would be approximately $38.36 for every day the amount is maintained. ($200,000 x 7% = $14000 divided by 365)
Short currency cash balances can occur as a result of Margin FX trading or borrowing of funds when using a margin loan to invest in stocks.
Please see our website for current interest rates applicable to short currency balances.
4. Other miscellaneous Fees and Charges you might encounter
Capital 19 does not charge any other fees, other than those described above. However, it is possible your account experiences fees charged by our executing broker, Interactive Brokers Australia
These fees might include
- Market data fees
- Multiple withdrawal fees
- Stock transfer fees
- Research Subscription fees
These fees will be disclosed to you prior to you accepting any of these services.
WHAT IS PAID TO OUR EMPLOYEES FOR PROVIDING FINANCIAL SERVICES TO YOU?
Our directors and employees who provide the financial services described in this FSG are remunerated by way of salary and other employee benefits. They may also be eligible for a discretionary bonus.
Employees may also be rewarded by monetary and non-monetary benefits which may include shares, conferences and functions (both in Australia and overseas), study support and gifts such as movie and theatre tickets.
It is not possible to determine in advance what (if any) additional benefits any employee will receive as these benefits are not generally attributed to any particular product (that the employee recommends or advises on) or service they provide.
FEES AND COMMISSIONS PAID TO THIRD PARTIES
If you have been referred to us by another party, that other party may receive an introductory fee and/or an ongoing commission on every transaction. This fee will usually be calculated as a percentage of C19’s fees but will be fully disclosed to you upon request and will not be an additional cost to you.
You may request further details of the fees and benefits (including any commissions) that may be payable at any time by contacting Capital 19 on +61 2 9002 0360 or email capital19@capital19.com
DO ANY RELATIONSHIPS EXIST WITH PRODUCT PROVIDERS WHICH MAY INFLUENCE THE ADVICE BEING GIVEN?
C19 and its respective directors, associates, connected parties and/or employees may from time-to-time deal in, or otherwise have a financial interest in, equities and other financial products referred to in its publications or other general financial advice it provides. Any individual who provides advice on behalf of C19 or contributes articles to our website must disclose if they have a financial interest or position in any share mentioned or discussed. Similarly, it will be disclosed to you if C19 has a beneficial interest or position in any share mentioned or discussed. You should review any disclosures made in particular publications as to interests C19 and its representatives may have in the financial products referred to in the publication.
All employees of C19 including those who prepare research and other advice are subject to a code of conduct and rules for their personal trading activities. Our major trading rules are:
- Employees cannot trade based on advance knowledge of information that will be published or broadcast by any member of C19;
- Employees must make all trading records available to C19 at any time;
C19 does not otherwise have any associations or relationships with the issuers of any products that might reasonably be expected to be capable of influencing C19 in the advice it gives.
PROFESSIONAL INDEMNITY INSURANCE
Capital 19 has Professional Indemnity Insurance in place that satisfies the Corporations Act and covers the financial services detailed in this FSG when provided by our authorised employees or representatives.
The limit of the indemnity is $2 million for any one claim and in the aggregate for all claims arising out of our AFS licence activities. The insurance will cover claims made in relation to the conduct of authorised representatives, representatives and employees who no longer represent Capital 19 (but who did at the time of the relevant conduct). We believe that our Professional Indemnity Insurance cover satisfies the requirements of s.912B of the Corporations Act.
YOUR PRIVACY
Capital 19 takes your privacy seriously because we know you do. All personal information is dealt with in accordance with the Capital 19 Privacy Policy. The Capital 19 Privacy Policy details how we comply with the Privacy Act in the handling of your personal information. You can view the Capital 19 Privacy Policy via our website at www.capital19.com. It is important to ensure that the personal information we retain about you is accurate, complete and up-to-date. Accordingly, if you have any concerns about the completeness or accuracy of the information we have about you or would like to access to or amend your information, simply call us on 1300 735 320.
It is important to note that any personal information we hold is only to satisfy our legal requirements and will not be considered when giving you advice.
WHO CAN I SPEAK TO IF I HAVE A COMPLAINT ABOUT THE SERVICE?
We are committed to providing quality service to our clients. This commitment extends to providing accessible complaint resolution mechanisms for our clients. If you have any complaint about the service provided to you, you should first contact our Complaints Manager on:
Phone: +61 2 9002 0360
Email: complaints@capital19.com
Post PO Box H69, Australia Square, NSW, 1215
We will try and resolve your complaint quickly and fairly.
If we cannot reach a satisfactory resolution, you can raise your concerns with
Australian Financial Complaints Authority (AFCA)
GPO Box 3, Melbourne, Vic. 3001.
Or email info@afca.org.au
We are a member of AFCA’s complaints resolution service that is free to consumers.
FURTHER INFORMATION
If you would like to clarification of any of the matters discussed in this FSG, you can contact us using the contact details set out above.