What this publication is for
The fill is not the price.
Between deciding to trade and owning the position, money leaves in a dozen places — some of them quoted to you, most of them not. This is a running account of every one: what it is, when it is charged, who sets it, and whether you can do anything about it.
We are not a broker and we sell nothing. Where a figure depends on the firm you trade through, we say so rather than quoting one as if it were universal.
The ledger · 12 costs
Every charge and friction between your decision and your fill.
12 of 12 shown.
The spread
The gap between the price you can buy at and the price you can sell at.
- When
- Every time you open or close
- Who
- Your broker
- Reduce
- PartlyChoose when you trade and who you trade through; you cannot trade without crossing it.
Bid and ask
The two live prices behind every quote — one to sell into, one to buy from.
- When
- Continuously, before you do anything
- Who
- The market
- Reduce
- NoIt is the structure of a quoted market, not a charge.
Commission
A stated fee per trade or per lot, charged on top of the spread.
- When
- On opening, and usually again on closing
- Who
- Your broker
- Reduce
- PartlyIt is quoted up front, so it can be compared between firms before you commit.
Overnight financing
A daily charge or credit for holding a leveraged position past the cut-off.
- When
- Every night you stay in
- Who
- Your broker
- Reduce
- PartlyHold for less time, or size smaller. For a long hold it can exceed the spread many times over.
Slippage
The difference between the price you asked for and the price you got.
- When
- At the moment of execution
- Who
- The market
- Reduce
- PartlyOrder type and timing change your exposure to it. Nothing removes it.
Spread widening
The spread growing — sometimes many times over — around news and session edges.
- When
- Releases, rollover, thin hours
- Who
- The market
- Reduce
- YesIt is largely predictable. Most of it is avoided by not trading into it.
Thin liquidity
Too few resting orders to absorb yours at one price, so it fills across several.
- When
- Off-session hours, small instruments, large size
- Who
- The market
- Reduce
- YesTrade when the book is deep, or in size the book can absorb.
Your choice of order
What you instruct the broker to prioritise — speed, or price.
- When
- Every order you place
- Who
- You
- Reduce
- YesThe one cost on this page that is entirely yours. It is also the least understood.
Gapped stops
A stop filling well past its level because price never traded in between.
- When
- Gaps, news, weekend opens
- Who
- The market
- Reduce
- PartlyA stop is an instruction to exit, not a promise of a price. Guaranteed stops cost extra.
The costs nobody quotes
Inactivity fees, withdrawal charges, currency conversion, data subscriptions.
- When
- Monthly, or on withdrawal
- Who
- Your broker
- Reduce
- YesAll disclosed somewhere. Almost never on the page advertising the spread.
Cost relative to your style
The same costs weigh completely differently on a scalper and a position trader.
- When
- Across every trade you make
- Who
- You
- Reduce
- YesMatch the style to the cost base rather than fighting the cost base.
Execution quality
How faithfully, and how fast, your broker turns an instruction into a fill.
- When
- Every order, mostly invisibly
- Who
- Your broker
- Reduce
- PartlyRarely published in a comparable form, which is itself worth knowing.
How to read it
Who sets it matters more than how big it is
A cost your broker sets can be compared and changed by moving. A cost the market sets cannot, at any firm. They are different problems and the ledger separates them.
5 of 12 are genuinely reducible
The rest you influence at the margin or simply pay. We would rather say so than sell a technique for removing something that cannot be removed.
No figures without a source
Spreads, commissions and financing rates vary by broker, instrument and hour. Anywhere we give a number, it is cited. Where we have none, it says so.
The long answers
All writing11 of the 12 rows above are written up in full. A row with no article still answers its four questions — it is simply not yet explained at length.
