Hi everyone,
Since I'm a scalper the spreads and the commissions are very important to me, to make the process of choosing a good ecn brooker I converted the commissions into pips (of course I also taking other factors in, like slippage, problems with users, etc...)
For converting the the commissions I did this calculations:
1. See who much the broker was charging for one million.
2. Multiply that value by two to get the value for the opening and closing the trade.
3.See how much is the pip in one million.
4.With using the value of the pip per million I convert the price of the commission into pips.
Example
1. The broker charges me 20.5€ per million
2.Multiply 20.5 by 2 ( 20.5€ charged when opening a trade and 20.5€ for closing the trade) 20.5*2=41€
3.The price of the pip in one million 82€
4. So if one pip costs 82€ then 41€ of commission represents 0.5 pips.
I used very simple values in this example to facilitate the math, but in the 4 steps with more complicated number I would use cross multiplication to obtain that value.
Is my calculations correct or I'm missing something?
Thank you in advance.
Since I'm a scalper the spreads and the commissions are very important to me, to make the process of choosing a good ecn brooker I converted the commissions into pips (of course I also taking other factors in, like slippage, problems with users, etc...)
For converting the the commissions I did this calculations:
1. See who much the broker was charging for one million.
2. Multiply that value by two to get the value for the opening and closing the trade.
3.See how much is the pip in one million.
4.With using the value of the pip per million I convert the price of the commission into pips.
Example
1. The broker charges me 20.5€ per million
2.Multiply 20.5 by 2 ( 20.5€ charged when opening a trade and 20.5€ for closing the trade) 20.5*2=41€
3.The price of the pip in one million 82€
4. So if one pip costs 82€ then 41€ of commission represents 0.5 pips.
I used very simple values in this example to facilitate the math, but in the 4 steps with more complicated number I would use cross multiplication to obtain that value.
Is my calculations correct or I'm missing something?
Thank you in advance.