Commission is set by strategy providers as a fee that investors must pay when they make profits.
Commission calculation
Strategy commission is calculated at the end of trading period or when an investor stops copying as follows:
Investment_Commission (USD) = (Equity+sum(Paid_Commission) - Invested_amount) * %commission - sum(Paid_Commission)
where:
- Equity = current investment Equity
- sum(Paid_Commission) = total paid commission till date for the particular investment
- Invested_amount = Investment’s starting balance
- %commission = Commission rate set by the strategy provider
Let us look at an example:
Investment’s starting balance (invested_amount) = USD 1000. Let us assume the strategy provider’s commission is set at 10%.
Profits made at the end of trading period = USD 2000
Current investment equity at the end of trading period (Equity) = USD 3000
Calculated commission = (Equity + sum(Paid_Commission) - Invested_amount) * %commission - sum(Paid_Commission)
= (3000 + 0 - 1000) * 10% - 0
= 2000 * 10%
= USD 200
Thus, the strategy provider will be paid USD 200 as commission and the investment’s updated balance at the end of trading period will be 3000 - 200 = USD 2800.
Now let us look at two scenarios for commission calculation - general and early investment closure.
General scenario:
At the end of a trading period:
- Strategy provider’s orders remain unaffected.
- All copied orders are closed and reopened with the same price (zero spread).
- Profits from copied strategy and equity are used to calculate the commission.
- Commission is deducted from the investment account.
- Calculated commission is credited to the strategy provider’s Social Trading Commission account in the Personal Area (PA).
Early investment closure:
If the Investor decides to stop their investment account before the end of the trading period:
- All copied orders are closed at the current market price.
- Profits from copied strategy and equity are used to calculate the commission.
- Commission is deducted from the investment account.
- Calculated commission is credited to the strategy provider’s Social Trading Commission account (in their PA), at the end of the trading period.
Details of commission calculated and paid per investment are available in the Commission Report found for each strategy in the strategy provider’s PA. If you have further queries regarding commission calculation, please contact our friendly Support Team.