Many brokers advertise zero commissions, but traders often misunderstand what that really means.
1. Zero Commissions = Higher Spreads
If a broker removes commission, they must earn money elsewhere — usually through spread markups.
Example:
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ECN account: 0.2 pip spread + $6 commission
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Zero-commission account: 1.2–1.5 pip spread
On larger lot sizes, the zero-commission model can be more expensive.
2. Hidden Execution Costs
Zero-commission accounts may suffer from:
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slower execution
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more slippage
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fewer liquidity providers
This creates invisible costs for traders who rely on precise entries.
3. When Zero Commissions Make Sense
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For beginners
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For small accounts
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For swing traders who open few positions
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For simple strategies with low-frequency trades
4. When to Avoid Zero Commissions
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Scalping
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High-frequency day trading
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Grid robots
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Expert Advisors with tight stop losses
Conclusion:
Zero commission doesn’t mean free trading.
Traders must calculate their real costs based on spreads, execution quality, and trading style.
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