How an IB rebate changes the break-even win rate on EURUSD

[FXS London Scalper]

Break-even win rate is the win rate needed to cover costs at a given reward-to-risk ratio. Rebates lower costs, so they lower the break-even win rate.

Formula: break-even win rate = (average loss + cost) / (average win + average loss)

where win and loss are measured before costs, and cost is applied to every trade.

Example: 4-pip target, 4-pip stop.

Without rebate (cost 0.9 pips):
Break-even = (4 + 0.9) / (4 + 4) = 61.25%

With rebate (cost 0.7 pips):
Break-even = (4 + 0.7) / (4 + 4) = 58.75%

A 2.5 percentage point drop in required win rate. For a strategy that wins 60%, that's the difference between losing and making money.

This also shows how sensitive tight scalping is to costs. With a 2-pip target and stop, the same cost difference shifts break-even from 72.5% to 67.5%.

Do you know your break-even win rate? Does it include rebates?