Freedom Investments, Inc. 375 Raritan Center Parkway Edison, NJ 08837 (800) 944-4033
SEC Rule 11Ac1-6 Report (Third Quarter 2003)
Freedom Investments, Inc., a wholly owned subsidiary of Fahnestock & Co., has prepared this report pursuant to a U.S. Securities and Exchange Commission rule 11Ac1-6 requiring all brokerage firms to make publicly available quarterly reports to their order routing practices. This report provides information on the routing of “non-directed orders” – any order that the customer has not specifically instructed to be routed to a particular venue for execution. For these non-directed orders, Freedom has selected the execution venue on behalf of its customers. For each section, this report identifies the venues most often selected by Freedom, sets forth the percentages of various types of orders routed to the venues, and discusses the material aspects of Freedom’s relationship with the venues.
I. Securities Listed on the New York Stock Exchange:
NYSE	Non-directed	Market	Limit	Other
Total Orders	100%	43.02%	56.76%	0.22%
Knight Capital	99.04%	98.76%	99.25%	100%
NYSE	0.96%	1.24%	0.75%	0.00%
Freedom routes orders to Knight Capital Markets, LLC for which it may receive payment. The amount of payment is based upon a formula that reflects the immediate marketability, the spread, and the size of the order. The payment is 10% of the spread at the time the order is received at Knight Capital. Eligible orders will include immediately executable market and marketable limit orders that are 2001-50,000 shares. The maximum payment is $.0225 per share.
II. Securities Listed on the American Stock Exchange:
AMEX	Non-directed	Market	Limit	Other
Total Orders	100%	33.80%	66.20%	0.00%
Knight Capital	98.59%	100%	97.87%	0.00%
AMEX	1.41%	0.00%	2.13%	0.00%
Freedom routes orders to Knight Capital Markets, LLC for which it may receive payment. The amount of payment is based upon a formula that reflects the immediate marketability, the spread, and the size of the order. The payment is 10% of the spread at the time the order is received at Knight Capital. Eligible orders will include immediately executable market and marketable limit orders that are 2001-50,000 shares. The maximum payment is $.0225 per share.
III. Securities Listed on the Nasdaq Stock Market:
NASDAQ	Non-directed	Market	Limit	Other
Total Orders	100%	30.30%	67.18%	2.52%
Knight Securities	99.19%	98.51%	99.46%	100%
NASDAQ	0.81%	0.00%	0.13%	0.00%
Freedom routes orders to Knight Securities, Inc for which it may receive payment. The amount of payment is based upon a formula that reflects the immediate marketability, the spread, and the size of the order at the time of receipt. Automated price improved orders receive a reduced payment. The maximum payment is 25% of the spread with a cap of $0.01 per share.
IV. Exchange-Listed Options:
OPTION	Non-directed	Market	Limit	Other
Total Orders	100%	0.30%	99.70%	0.00%
ABN AMRO	94.56%	100%	94.55%	0.00%
AMEX	5.44%	0.00%	5.45%	0.00%
Freedom Investments, Inc. forwards orders for options to ABN Amro, who in turn routes the orders to the applicable option exchange. Freedom does not receive payment from ABN Amro for executing option orders.