When many people review trades, their first reaction is usually: “Did I misread the market?” “Was the entry position poor?” “Did I judge the direction wrong?”
But there’s one issue that’s often overlooked: trading costs.
Sometimes, the final outcome is influenced not only by market movements, but also by various hidden costs within the trading process.
Trading costs are not just commissions.
Many beginners think: trading costs = commissions. But that’s not entirely correct.
In a complete trade, you might encounter:
1. Commissions
This is the most common one. When you buy, sell, or open and close positions, you may incur commissions. The more trades you make, the more obvious the cumulative costs become.
2. Slippage cost
In short: the price you see isn’t necessarily the final execution price.
Factors such as market liquidity and order size can all affect the actual execution price.
For example: you plan to buy at a certain price, but the actual execution price is slightly higher. This difference is the impact caused by slippage.
3. Funding rate
In perpetual futures, there is also a funding rate. It’s not the platform’s fee, but a mechanism for exchanging funds between long and short positions. If you hold positions for a long time, you also need to pay attention to this cost.
A simple example
Assumption: a user executes multiple trades every day.
A single trade’s fee doesn’t look high: a few U, dozens of U. Many people think: “These costs don’t matter much.”
But: dozens of times a day, hundreds in a month—over the long run, trading costs may become an overlooked but significant portion.
It’s like small everyday expenses: each time it doesn’t seem like much, but over time it can create a noticeable gap.
Why do many people overlook trading costs so easily?
Because price movement is very straightforward.
Price rising: you can see the account change immediately.
But costs are often spread across every single trade.
Many people focus on: “How much did I make this time?”
Yet few people calculate: “How much trading cost did I actually pay during this period?”
Great trading habits are not just about focusing on direction. In the market, no one can guarantee that every judgment is correct.
But everyone can cultivate a habit: understand your trading costs.
For example: how much fee is generated each month? Do you tend to trade frequently or hold long-term? Which costs are most likely to be ignored? Treat trading like an accounting exercise, not a single outcome.
Summary
Trading results depend not only on: directional judgment. Also on: cost control.
Fees, slippage, funding rates—these seemingly insignificant numbers can all affect the final outcome in long-term trading.
Understanding trading costs doesn’t necessarily mean getting results.
But it can help you: get a clearer understanding of your trading behavior.