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A gold position can move in the expected direction and still deliver little or no net profit after costs. For CFDs, compare the whole charging structure for your expected position size and holding time, not just the headline spread.
Spread: the gap between bid and ask
With a hypothetical bid of 2,400.00 and ask of 2,400.40, the spread is $0.40 per ounce. On 5 ounces that represents about $2 for an immediate round trip at unchanged quotes. Spreads can change; the displayed minimum is not a promise of execution during a busy announcement or a thin market.
Commission: check each side
A fee described as “per lot” might apply to opening, closing, or a complete round trip. Suppose the fee is $4 per lot per side and volume is 0.50 lot. Opening costs $2 and closing costs $2, for $4 in total. Confirm minimum fees and whether partial closes are charged separately.
Financing: read the timing and units
Holding past a provider’s cutoff can create an overnight debit or credit. The calculation may use an annual rate, points or another stated basis, with different terms for buys and sells. Weekend and holiday adjustments vary. Check the current schedule and translate the cutoff into your own time zone, including daylight-saving changes where relevant.
A “swap-free” label does not establish that holding is cost-free. Check administration fees, eligibility and any time limit. An example from one provider is not a tariff that applies to every account.
Account and currency charges
A dollar-quoted trade in an account funded in another currency may incur conversion costs. Deposit, withdrawal or inactivity charges can also affect the account result. Keep these separate from the individual trade calculation so comparisons remain meaningful.
Avoid subtracting the spread twice
Suppose actual entry and exit fills produce a $60 gain. With $4 total commission and $2 financing charged, the net is $54 before conversion and tax. The entry/exit difference already contains the effect of bid and ask. If you start instead from a theoretical mid-price move, you must estimate execution spread and slippage before calling it a tradable result.
Compare equivalent scenarios
Request a written cost schedule and compare the same ounces, direction, holding period and account currency. For physical gold, substitute dealer buy/sell premiums, storage and delivery; for funds or futures, use their own fee schedules. The cheapest advertised CFD spread says nothing about those different products or the protection of your funds.
Educational information, not a personal investment recommendation. All numerical examples are hypothetical, not live quotes. Product availability, protections and tax treatment depend on your residence and the contracting entity. Leveraged trading can cause rapid losses; a stop order does not guarantee its execution price.
Continue with the gold learning guides
- Gold trading for beginners: products, costs and risk
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- How to calculate XAUUSD profit, loss and position size