Trading Costs & Fees
Everything you need to know about your trading costs and fees.
Spreads
In any trading transaction, there is a bid and ask price. These represent the price at which you can sell and buy an asset, respectively.
A spread is the difference between the sell and buy price and is quoted in pips, which is the smallest unit of price movement of a currency pair.
What you Should Know About Spreads
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ALPHAMARKETZONE offers variable spreads on all its account types – Classic and Raw. Variable spreads tend to fluctuate according to different factors such as underlying liquidity or market volatility.
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The Classic account offers spreads starting from 1.6 pips with no commissions.
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The Raw account offers spreads starting from 0.0 pips with low commissions.
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You can check out our spreads by clicking here.
How to calculate your transaction cost?
To work out the cost of a trade itself (excluding swaps, commissions etc.), you take the spread and pip value and multiply it by the number of lots that you’re trading:
Trade Cost = Spread X Trade Size X Pip Value
For example:
A trade you have opened has 1.2 pips spread. In this example, you’re trading with mini lots which are 10,000 base units.
The pip value is at $1, so the transaction cost is $1.20
Commissions
ALPHAMARKETZONE charges commissions on CFDs on Forex and Precious Metals including Gold and Silver. There are no commissions on the Classic account.
| Account Type | Commission |
|---|---|
| Raw Account | $3 per lot per side |
For example:
A client goes long 1 lot of USDCAD. The client is a Raw account holder, so is charged $3 per side.
So, the commission charged for this trade (open and close) = $3 x 2 (all commission charged and debited).
Total commission = $6
Swaps Charges
Swap charges or rollover fees apply when you keep your positions overnight.
Our updated swaps are always available here.
You can also check the swap rates by logging into the MT4 trading platform and select: View > Symbols > Select instrument > Properties
Key Facts about Swaps Charges
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Each currency has its own swap charge and is measured on a standard size of lot (100,000 base units).
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Swap rates are determined by the interest rate differential of the currencies involved in the pair, the current market conditions and your position type (long or short). You must look at the Financing long for swaps for buy positions and at the Financing short for swaps for sell positions.
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Swap rates are applied on each trading day at 00.00 platform time. On Wednesday night swaps are charged at triple rate the usual rate.
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No swap rates apply to Islamic accounts. However, a daily charge applies for holding several instruments overnight for more than three consecutive nights. Find out more here.
Other Fees and Charges
ALPHAMARKETZONE does not charge any inactivity fees if there is no trading activity or no open positions for a certain period of time.
Calculating the Net Profit/Loss of a Trade
Example:
You have deposited 5,000 USD on your Raw Account and traded 2 lots of EURUSD. Your position is kept open for 2 days.
| Account Type: Raw Account |
| Account base currency: USD |
| Trade size: 2 lots (200,000 units) |
| Leverage value: 1:30 |
| Position open for: 2 days |
Spread: $4
The pip value of 1 lot is at $10, so for 2 lots, the pip value will be $20. In this case, if the spread is 0.2 pips,
your spread cost will be: 0.2 pip x $20 = $4
If for instance EURUSD drops by 10 pips, the gross profit will be 10 pips x $20 per pip = $200
Cost of swaps:
Swap Long: -$19.20
Current Swap points for going long on EURUSD is -4.8 points.
The swap charge will be equal to
2 lots x (-4.8) x 2 nights = -$19.20
Swap short: +$2.776
Current Swap points for going short on EURUSD is 0.694 points.
The applied swap will be equal to
2 lots x (+0.694) x 2 nights = +$2.776
Commission: $12
You will be charged $3 per lot per side. So, the commission charged for this trade (open and close) =
$6 x 2 (all commission charged and debited)
Total commission = $12
Total trading costs in a nutshell
| Long/Short | Instrument | Volume (Lots) | Spreads (in pips) | Spread value in Euro | Commission | Swaps (for 2 nights) | P/L | Net Profit | Total Cost | % of Costs on Return | |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Raw | Long | EUR/USD | 2 | 0.2 | -4.00 | -12 | -19.2 | $200.00 | $164.80 | $35.20 | 17.60% |
| Raw | Short | EUR/USD | 2 | 0.2 | -4.00 | -12 | 2.78 | $200.00 | $186.78 | $13.22 | 6.61% |
Note: All examples used in this page are for illustrative purposes only.