Understanding Trading Costs
Key takeaways
- Total cost is more than commission: spread, slippage, and swaps matter.
- Percentiles (p50/p90) help you understand typical vs. stressed conditions.
- Compare brokers using total cost + proof (receipts and methodology), not slogans.
The cost stack
Your all-in trading cost includes up to four components:
- Commission (fixed per lot)
- Spread (variable, market-dependent)
- Slippage (the difference between reference and fill price)
- Swaps (overnight financing, if you hold past rollover)
Most brokers highlight commission. The rest of the stack is where costs hide.
Commissions
Commission is a fixed fee per trade (often per lot). At Milton Prime, commissions are charged per round-trip (RT) lot (open + close).
- Core: $7 per RT lot
- Active: $5 per RT lot (deposit-qualified pricing)
Commissions are predictable. You can estimate them before you trade.
RT (round-trip) = open + close. 1 RT lot = 2 sides.
Spreads
The spread is the difference between the bid and ask price. You "pay" it when you enter (and effectively again when you exit via the market).
Spreads vary with:
- Instrument
- Time of day and available liquidity
- Volatility and news events
How to interpret spread stats
- p50 (median): typical conditions. Half of observations fall at or below this level.
- p90: stressed or less liquid conditions. 90% of observations fall at or below this level.
Example (illustrative): If EURUSD spread is 1.0 pip and your pip value is ~$10 per standard lot, the spread cost is roughly ~$10 per lot per round-trip.
Pip value varies by pair and account currency. This is a simplified example.
Slippage
Slippage is the difference between your reference price and your fill price.
- Positive slippage: filled better than reference
- Zero slippage: filled at reference
- Negative slippage: filled worse than reference
Slippage is not inherently good or bad. It is a normal result of fast markets. What matters is the distribution over time and the ability to verify context.
Learn how execution works | View a sample trade receipt
Swaps (overnight financing)
Swaps are charged or credited when you hold positions overnight. They depend on the instrument, direction, and prevailing rates.
If you hold overnight, swaps can be a meaningful part of total cost.
Total cost per trade
A simple way to think about it:
Total cost = Commission + Spread cost + Slippage cost + Swaps (if held overnight)
If you compare brokers on commission alone, you can miss the larger costs.
How to compare brokers (checklist)
- Compare all-in cost, not just commission. Wider spreads or worse slippage can cost more than commission savings.
- Ask how spreads behave in stressed conditions. p90 matters.
- Look for evidence: receipts and documented methodology, not slogans.
- Understand swaps if you hold overnight.
- Check fees: withdrawals, inactivity, conversion, platform fees.
How Milton Prime makes this measurable
We focus on proof:
- Trade receipts for fill context (spread-at-fill, slippage, tick window)
- A transparency report with methodology-first reporting
- Clear commission pricing you can calculate up front
Trade receipts | Transparency report | Calculator
Common questions
Does lower commission always mean lower cost?
No. Wider spreads or worse slippage can cost more than commission savings. Always compare total cost.
What does p50/p90 mean?
p50 is the median (typical conditions). p90 captures what happens during stressed or less liquid periods. Both matter when evaluating a broker.
What is an RT lot?
Round-trip = open + close. 1 RT lot = 2 sides. Milton Prime quotes commissions per RT lot.