Every trade has a cost before it makes or loses a cent. Knowing the three main costs helps you choose the right markets and timeframes for your style.
Spread
The difference between the bid (sell) and ask (buy) price. You pay it when you open a trade: a new position starts slightly negative. Spreads are usually tightest during the London and New York sessions and widest around news and at the daily rollover.
Commission
A fixed fee per lot traded, charged on some instruments in addition to the spread. On gold at Axora, for example, the platform shows the commission per lot in the instrument information.
Swap (overnight financing)
A small charge or credit for holding a position past the daily rollover, based on the interest-rate difference between the two currencies or the financing cost of the instrument. It matters for swing traders, rarely for intraday traders.
Why costs matter
- Scalpers with 5-pip targets lose a large share of each win to costs.
- Swing traders with 100-pip targets barely notice spread, but swap adds up over many nights.
- Trading around news means paying wider spreads.