Commission math at tiny targets
Posted: Sat Oct 31, 2026 8:30 pm
A scalper aiming for 2 pips with a total cost of 0.9 pips is giving away 45 percent of the gross target before anything else happens. That is why a system with a 60 percent win rate on paper can bleed in practice.
Here is how it breaks down. Win 6 of 10 trades at +2 pips gross: +12. Lose 4 of 10 at -2 pips gross: -8. Net before costs: +4 pips. Costs at 0.9 per trade across 10 trades: -9. Final result: -5 pips.
So a system that looks profitable stops being profitable the moment real costs are applied. Increasing the target to 4 pips with the same cost and the same win rate changes the math entirely, because the cost share drops from nearly half to about a fifth.
This is the main reason experienced scalpers talk so much about spread and so little about indicators. The edge has to be larger than the toll booth.
Worth running the spreadsheet before building anything on top of it.
What is the cost-to-target ratio in your current setup, and has it ever made a profitable looking system fall apart?
Here is how it breaks down. Win 6 of 10 trades at +2 pips gross: +12. Lose 4 of 10 at -2 pips gross: -8. Net before costs: +4 pips. Costs at 0.9 per trade across 10 trades: -9. Final result: -5 pips.
So a system that looks profitable stops being profitable the moment real costs are applied. Increasing the target to 4 pips with the same cost and the same win rate changes the math entirely, because the cost share drops from nearly half to about a fifth.
This is the main reason experienced scalpers talk so much about spread and so little about indicators. The edge has to be larger than the toll booth.
Worth running the spreadsheet before building anything on top of it.
What is the cost-to-target ratio in your current setup, and has it ever made a profitable looking system fall apart?