Trading Cost Analyzer
Analyze how commissions, spreads, and account type impact your annual trading costs.
Step 1: Trading Volume
How often and how much do you trade?
Average number of round-turn trades monthly
Average lot size per trade
Why Trading Costs Matter More Than You Think
The average retail trader underestimates their annual trading costs by 3-5×. They look at commission per trade and think 'it's nothing', ignoring the hidden cost of spreads, swap fees, and account type differences.
A day trader making 100 trades/month at $7 commission + 1 pip spread on 1.0 lot is paying $1,800/month or $21,600/year. That's 216% of a $10k account. The broker makes more than the trader on most accounts.
Account type matters enormously. Raw/Razor accounts with lower spreads but commission per lot are often 30-50% cheaper for active traders than Standard accounts with 'commission-free' trades but wider spreads.
Real Examples
Standard account · 1 pip spread · $10/pip
Common Mistakes
#1: Ignoring Spread Costs
What traders do
Only looking at commission when choosing a broker, ignoring the spread
The consequence
A 'zero commission' broker with 2-pip spread costs more than a $7/lot Raw account with 0.2-pip spread for active traders. You pay for it through wider fills.
What to do instead
Always calculate total cost = commission + spread × pip value. Compare brokers on total cost, not just commission.
#2: Wrong Account Type for Your Volume
What traders do
Using a Standard account with 1.5-pip spread when trading 50+ lots/month
The consequence
At 50 lots/month: Standard costs ~$750/month in spread. Raw costs ~$350 commission + $100 spread = $450/month. You're overpaying by $300/month or $3,600/year.
What to do instead
If you trade 20+ lots/month, use a Raw/Razor account. The spread savings far outweigh the per-lot commission.
#3: Not Tracking Costs Monthly
What traders do
Checking trading costs once a year or only when reviewing P&L
The consequence
Costs that go unnoticed compound silently. A $500/month cost overage is $6,000/year — that could be 30-60% of your net trading profit going to the broker instead of your pocket.
What to do instead
Review your trading costs monthly. Track as a percentage of your account. Set a maximum acceptable cost-to-account ratio.
The Math Behind Trading Costs
Step 1: Calculate annual commission
Annual Commission = Trades × Lots × Commission × 12
= 50 × 1.0 × $7 × 12
= $4,200/yearStep 2: Calculate annual spread cost
Annual Spread = Trades × Lots × Spread × Pip Value × 12
= 50 × 1.0 × 1.0 × $10 × 12
= $6,000/yearStep 3: Total cost
Total = Commission + Spread
= $4,200 + $6,000
= $10,200/yearStep 3: Total cost