Commission in gold trading
Commission is a fixed fee per lot charged on some gold accounts in exchange for a tighter spread; it is paid per side or per round turn.
Also called Round-turn commission, Per-lot fee
A commission is an explicit fee charged for executing a trade, usually quoted per standard lot per side or per round turn (open plus close). Accounts that charge commission typically offer a tighter raw spread; accounts with no commission build the cost into a wider spread. Neither is free; they are two ways of paying for the same service.
How it applies to gold trading
To compare accounts, convert everything into dollars per standard lot per round turn. As a hypothetical, Account A quotes a 30-cent spread with no commission: cost $30 per lot. Account B quotes a 10-cent spread plus $3.50 per side: $10 + $7 = $17 per lot. For a scalper taking many trades the difference matters; for a swing trader holding for days the swap will matter more than either.
Commission is charged on the full lot size, so a 0.01-lot trade pays one hundredth of the per-lot rate. It is deducted from the balance when the trade is opened (or half on open, half on close), which is why a new trade can show a slightly larger initial loss than the spread alone would suggest.
Commission accounts also make costs visible: the fee appears as a separate line in the account history, which makes it easier to track the true cost of a strategy than when it is buried in the spread.
A common mistake
Comparing spreads between accounts without adding commission, or the reverse. Only the total round-turn cost for your usual size and holding time is comparable.
See also: Bid, ask and spread, Swap and rollover, Scalping.
Frequently asked questions
Is a commission account cheaper for gold?
Sometimes. Add the commission to the spread and compare the total per lot. Commission accounts tend to win for frequent trading; the gap narrows for traders who take a few trades a week.
Is commission charged on both opening and closing?
It depends on the account. Some charge per side, some charge the full round-turn amount at opening. The account terms state which.