Spreads, commissions and swaps: the real cost of a trade

A broker that advertises zero commission is not necessarily the cheapest, and a broker with a commission is not necessarily expensive. What matters is the total cost of opening, holding and closing a trade.

The four costs

• Spread: the difference between buy and sell prices, paid every time you open and close.
• Commission: a fixed charge per lot, usually per side, on raw-spread accounts.
• Swap (overnight financing): a charge or credit for holding a position past the daily rollover. IG’s UK charges page, for example, describes overnight funding as the benchmark interbank rate plus an IG admin fee. Many brokers apply triple swap on Wednesday for the weekend.
• Other fees: currency conversion (for instance 0.8% at IG and up to 0.7% at Plus500), and inactivity or dormant-account fees (Plus500 up to US$10 a month, XM US$5 a month, AvaTrade 50 after three months).

A worked comparison

Using FP Markets’ published September 2026 EUR/USD averages, one standard lot with a pip value of about US$10:

Account	Spread cost	Commission	Total to open and close 1 lot
Standard, average 1.2 pips, no commission	1.2 × US$10 = US$12	None	About US$12
Raw, average 0.1 pips, US$3 per side	0.1 × US$10 = US$1	US$3 × 2 = US$6	About US$7

The raw account is cheaper per lot here, but only if you trade often enough to benefit, and only if the average spread you pay matches the published average. A ‘from 0.0 pips’ headline is a best case, not a typical case.

How to compare fairly

1. Ask for the average spread on the pair you trade most, not the minimum.
2. Convert commission to a per-lot, round-turn figure.
3. Add typical swap if you hold trades overnight.
4. Check for conversion, inactivity and withdrawal fees.
5. Compare live spreads on a demo account at the time of day you trade.

General information for education only, not financial advice. Trading forex and CFDs carries a high risk of loss. Read the disclaimer.