investment products made available, access to securities markets and expertise in handling
brokerage support processes. We may also select custodians based on dual registrations and/or
other qualifications and/or experience. The Firm reviews the execution of trades at each
custodian used to determine whether the clients are receiving the best execution for their
transactions. We will consider whether the total costs to our clients, considering all factors,
including any discounted commissions and other trading costs charged to our clients by virtue of
our relationships with our existing broker-dealers, are significantly affected by poor execution or
execution errors. If we determine it is in the best interests of our clients to do so, we will change
broker-dealers. In addition, if during our review of the broker-dealer execution we determine
that Apex fails to provide the proper securities for Shari’ah compliance, we will change
broker-dealers.
Apex is a registered broker-dealer (member of FINRA and SIPC). We are independently owned
and operated and not affiliated with Apex. Apex provides brokerage, operational support and
other custodial services to our firm. Apex will be recommended to our discretionary and non-
discretionary investment management clients as a result of our established services agreement,
cost implications, operational support, and custodial services provided.
Wahed receives research or other products or services from broker-dealers in exchange for
placing trades or processing securities related transactions for clients. No client is charged
directly for these services. Specifically, Apex makes available to us other services intended to
help us manage and further develop our business enterprise, such as software, compliance and
business consulting, practice management publications and conferences, access to employee
benefit providers, and other services. The products or services received may benefit all of our
customers, not just those whose assets are custodied at the broker-dealer who provides the
products or services. This may result in higher transaction costs than those that would have been
incurred but for the soft dollar benefits. We have determined that the transaction charges we
incur and charge to you are reasonable in relation to the value of the services received.
As a fiduciary, we endeavor to act in our client’s best interests. The above-described
arrangement may create a conflict of interest as we may to want to place more client accounts
with a broker-dealer/custodian such as Apex, solely or primarily because of these added
benefits. As such, Wahed may have an incentive to select or recommend a broker-dealer based
on interests in receiving the research or other products or services, rather than on clients’ interest
in receiving most favorable execution. Wahed attempts to mitigate this potential conflict by
performing regular reviews of execution services and the value clients receive to ensure clients
are receiving the best possible value for costs paid. However, the value to all of our clients of
these benefits is included in our evaluation of custodians. These benefits provide additional
value, and are accordingly considered in determining which broker-dealer or custodian to utilize
as part of our best execution analysis. However, we monitor and periodically assess the totality
of these benefits, including particularly those that inure directly or indirectly to our clients, to
assure that the continued recommendation of Apex, such other broker-dealer or such other third
party manager is in our clients’ best interests.
Wahed also does not use client transaction fees to compensate or otherwise reward any third-
parties for client referrals. In the interest of better trade execution, Wahed may enter trades as a
block where possible and when advantageous to clients whose accounts have a need to buy or
sell shares of the same security. This blocking of trades permits the trading of aggregate blocks
of securities composed of assets from multiple client accounts, so long as transaction costs are