What copying really costs
Reading time: 1 min
Four costs. Three are already deducted from the displayed performance, only one comes on top.
The four costs
- SpreadThe broker, on every opening and closing.Already deducted
- Broker commissionThe broker, on every trade (Raw ECN account).Already deducted
- SwapThe broker, every night a position stays open.Already deducted
- Strategy commission20% of gains, on the 1st of the month, above the high-water mark.On top
Out of €100 gained, who takes what?
- For you€69.57
- Strategy commission (20%)€17.39
- Spread and broker commission€6.52
- Swaps€6.52
- Total cost€30.43
Split from an example month: broker fees and swaps vary every month. The displayed performance is already net of these fees, but not of the 20% commission.
Before copying a strategy
- Is the performance net of broker fees and swaps?
- Before or after the strategy commission?
- What rate, and with a high-water mark?
- Which account type is required, Raw ECN or STP?
And at PlanetFinance?
Broker fees in detail
The spread is the gap between the buy and sell price. A Raw ECN account has a very tight spread and a commission of about 3 dollars per lot per side at Vantage, so 0.60 dollar for 0.1 lot opened then closed. An STP account has no commission but a wider spread. The swap is counted every night, three times on Wednesday, and can cost or pay: see the guide Forex swap.
Further reading
This guide is for information only. It does not constitute investment advice. Past performance is not a reliable indicator of future performance. Trading Forex with leverage carries a high risk of capital loss.