Direct answer: a worked example of per lot commission
A worked example of per lot commission is a step-by-step calculation that turns a “commission per lot” rule into a total commission figure for one or more trades. To be verifiable, it must state every assumption: the commission rate, the trade size expressed in lots, and how lot-counting works for partial fills.
Mechanism or definition: what per lot commission means
Per lot commission means the provider charges (or credits) a commission amount based on the number of lots you trade. The core calculation is:
- Total commission = (commission rate per lot) × (number of lots)
Key terms used in the calculation:
- Lot (in FX): a standardized trade size used for quoting and fee calculation. A common reference is that 1 standard lot = 100,000 units of the base currency, but exact lot conventions can vary by platform and instrument.
- Commission rate per lot: the fee expressed “per lot,” often for a round turn model (both opening and closing) or sometimes separately per side.
Because fee models vary, a worked example must explicitly choose a commission structure (for example, commission charged per side vs. round turn) and apply it consistently.
Evidence or example: one fully stated scenario
Assumptions (all chosen for the example)
- Commission is charged per side (opening trade and closing trade each incur commission).
- Commission rate is $3 per lot per side.
- You open 1.50 lots and later close the full same 1.50 lots.
- No other fee components exist in this example (no financing/rollover, spread cost is not included, and no extra charges apply).
- Lot counting is exact and not affected by rounding.
Step-by-step calculation
Opening leg
- Lots traded on open = 1.50
- Commission on open = $3 × 1.50 = $4.50
Closing leg
- Lots traded on close = 1.50
- Commission on close = $3 × 1.50 = $4.50
Total commission for the round trip
- Total = $4.50 + $4.50 = $9.00
What would change the result
- If the commission were charged per round turn instead of per side, you would apply the rate once for the combined open+close rather than twice.
- If only 0.80 lots were actually executed due to partial fills or different executed size than the order size, the commission would be based on executed lots, not the intended size.
Limitations and risks: why worked examples can still differ from real costs
- Variable execution and partial fills: If your order is partially filled, the number of lots that actually execute on each leg can differ from what you expected, changing total commission.
- Rounding and lot conventions: Some systems round fee inputs (for example, executed quantity) to increments, which can slightly change the computed commission versus a hand calculation.
- Provider-specific fee structure: Commission may be charged per side or per round turn, and the presence of additional components (such as other account or platform fees) can make “commission per lot” not the only cost.
- Market-related costs outside commission: Even if you calculate commission correctly, total trading cost also depends on other factors (for instance, price difference and financing), which are not included unless you explicitly add them.
Verification or next question: how to independently check your own numbers
To verify a per lot commission calculation, compare your own numbers to the fee terms you are subject to, using the same structure as the example:
- Confirm whether the commission is charged per side or per round turn.
- Confirm the commission rate per lot and the lot convention used for the instrument/account.
- Use the executed lot sizes for the opening and closing legs (not just your order size).
If you want, share the commission model you are looking at (per side vs round turn) and an example executed lot size, and the calculation can be shown again with the same explicit assumptions—without assuming any profit outcome.