Commission

An explicit execution fee, shown as its own line rather than folded into the price. Two pricing models exist side by side across the industry: an account that quotes raw dealing spreads and charges commission on top, and an account that charges no commission and recovers the cost inside a wider spread. Neither is free of the other's cost. They differ in where the cost is disclosed, which is why the two only become comparable once both are converted into a single all-in figure.

The unit of quotation differs by asset class. Currency and commodity contracts are conventionally charged per lot, and share contracts as a percentage of the notional value traded, often with a stated minimum. Either can be quoted per side, charged separately on the opening and the closing, or as a round turn covering both. The charge is converted into the account currency at the prevailing rate and appears on the ticket and on the statement.

Almost every comparison error comes from the basis. A figure quoted per side is half a figure quoted per round turn, and the two are printed in the same font. A per lot charge and a percentage of notional cannot be compared until both are expressed against the same trade size. And commission on its own is not the cost of a trade: the spread paid on entry and exit, the commission, and any financing on a position held overnight are three separate charges, and only their sum describes what a position cost.