Commission calculation examples
US CFD stocks
Suppose a trader buys 50 lots of Coca-Cola (KO) for a unit price of $53. This is a US share, so the fee will be 50 × $0.02 = $1. However, this amount does not reach the amount of the minimum commission. In this case, the trader pays the minimum commission, which corresponds to 5 USD.
The same trader then decides to buy another 500 pieces of this share for the price of 54 USD. He pays $500 × $0.02 = $10 for this transaction.
If he later decides to close the entire position, he will sell 550 pieces for the price of 56 USD. He pays $550 × $0.02 = $11 per transaction.
Note that the share price does not play a role here. The trader always pays only for the amount of shares traded, provided he exceeds the value of the minimum commission.
Example no. 2
Other CFD shares
Let’s say the trader buys 10 CFD shares of Volkswagen Group (VOWG) for a unit price of EUR 190. As this is not a US share but rather a European one, the fee will be calculated from the nominal value of the transaction. The nominal value of the transaction is 10 × 190 EUR = 1900 EUR. Of this, 0.1% represents EUR 1.9. The trader pays the minimum value of the commission to the commission, i.e. 5 EUR.
As in the previous case, however, our trader decides to increase his position and buy another 50 shares for the same price of 190 EUR. The nominal value of the transaction will be 50 × 190 EUR = 9 500 EUR and the fee will therefore correspond to 9.5 EUR.
Suppose the price rises to 250 EUR and our trader decides to close his position. He will therefore sell a total of 60 shares. The nominal value of the transaction corresponds to 60 × 250 = EUR 15,000. In this case, the fee of 0.1% is EUR 15.
Note that in this case it is not only about the amount of traded shares, the share price is also important, and therefore the resulting nominal value of the entire transaction. This example also shows why the commissions are paid separately for the opening and the closing side of the trade position when trading shares.