What a trade costs
Lesson 10 of 16 in the course “Futures from Zero”. Free, with animations and a quiz.
Fees on the position, not the deposit
The exchange charges fees on position size, usually around 0.02% for makers and 0.05–0.06% for takers. Sounds tiny. But Nika opened a $2,000 trade ($100 margin at ×20) at market and closed at market. That’s $1 + $1 = $2, or 2% of her margin per round trip. The price has to move 0.1% her way just to break even.
Frequent trades eat the account
Now imagine Nika makes 10 such trades a day. Over a month that’s about $440 in fees alone on $100 of margin. Even if she’s right more often than wrong, fees can eat everything. Two takeaways. One: fewer, better trades. Two: where possible, enter with a limit order, and the fee is 2–3 times lower.
The full bill for a trade
Before a trade, add it all up. Fees on entry and exit. Funding if you hold a perp longer than 8 hours. Swap if you hold overnight at a broker: the charge for the money in your leverage being “borrowed”. Spread: at a broker you buy a little higher than you sell, so a trade starts slightly in the red. And slippage on sharp moves. A good trade is one where the expected profit is clearly bigger than all these costs.
Check yourself
- A $2,000 position, market in and out, taker 0.05%. Fees per round trip?
Correct answer: $2. 0.05% of $2,000 is $1. In and out: $2. Fees are on the position, not the margin. - What’s the easiest way to cut fees?
Correct answer: Trade less often and enter with limit orders. Maker fees are 2–3 times lower than taker fees, and every extra trade is another payment. - What is a swap at a broker?
Correct answer: A charge for holding a position overnight. A swap is the cost of the money in your leverage. It can be positive, but for gold and most positions it’s a cost.