How costs quietly eat small edgesBeginner

Spread, commission and slippage explained, and why tight stops make them worse.

Every trade pays

Each trade pays the spread and usually commission. On a 15-minute gold trade with a 4-dollar stop, a 0.3-dollar spread is already 7.5% of your risk, so every trade starts at about -0.08R.

Why it matters

Many strategies average +0.05R to +0.1R per trade before costs. Subtract 0.05R to 0.1R of costs and the edge is gone. This is the most common reason a strategy that 'works' on a chart fails with real money.

What to do

Prefer wider stops on higher timeframes when the edge is small. Trade the most liquid markets and sessions. Always test with costs switched on. In WickCheck they are included by default at typical levels per market.

Try it on your own strategy

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More lessons

Why most strategies need a human behind the screenWhat a backtest can and cannot tell you about discretionary trading, and how to use both.Trading sessions and killzones: times, what happens in each, and how to test themAsian, London and New York sessions and the ICT killzones, with exact times in New York and London time, daylight saving notes and test rules.What a backtest is, and what it is notThe basics in five minutes: rules, data, costs and the limits of testing the past.Why 30 trades prove nothingHow luck hides in small samples and how many trades you actually need.When a great result is just luck: overfittingHow to tell a real edge from a curve-fitted one.R, risk per trade and drawdown in plain wordsHow position size, R-multiples and drawdown fit together.How to read your WickCheck resultsWhat each number means and the order to look at them in.

Education only, not financial advice. Definitions vary between teachers; these are ours, written for clarity.