Spot Trading and Execution · Crypto Trading Guide

Trading costs apply to the whole process. Reconcile fills, fees, funding and transfers before deciding whether a strategy made money.

List costs by activity

Spot trades can incur execution fees and spread or slippage costs. Moving assets may add network and withdrawal costs. Borrowed positions can incur interest, while perpetual contracts can involve funding. The exact schedule depends on venue, product, account tier and execution. A maker label does not imply that every order earns a rebate.

Calculate a round trip

Assume you buy 10 units at $100 and later sell them at $102. A hypothetical 0.2% fee applies to each side and is paid in dollars. Entry fee is $2 and exit fee is $2.04. Gross trading profit is $20, so net profit is $15.96 before any other costs. These rates are teaching assumptions, not a venue quotation.

Find the break even exit

With entry price P and equal percentage fee f on each side, an illustrative break even sale price is P × (1 + f) ÷ (1 minus f), assuming fees are added to entry cash and deducted from sale proceeds. At P = $100 and f = 0.002, the result is about $100.4008. Selling at the original price would lose money after fees.

Keep an auditable ledger

Store each fill quantity, price, fee amount and fee currency. Convert noncash fees consistently when reporting results. If your calculation already uses actual execution prices, avoid charging an estimated spread a second time. Include transfers only when they belong to the strategy being measured, and explain how shared costs are allocated. A strategy that appears attractive before costs may fail when repeated frequently, especially for small trades with fixed network charges.

Try it yourself

A trade earns $12 before costs. Execution fees total $7 and a required transfer costs $6. What is the result?

Show the worked answer

The net result is a $1 loss. Counting the transfer as optional would change the strategy being evaluated.

Further reading

Educational material. Examples and rates are hypothetical, not trade recommendations. Product terms, eligibility and risks vary by venue and jurisdiction.

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