MetaTrader 5 (MT5) is a powerful platform for trading various financial instruments. A key aspect of trading is understanding the associated costs. This guide provides a clear breakdown of the commission and swap fees you'll encounter when trading on an MT5 platform.
Commission Fees
On MT5, transaction fees are referred to as commissions. The commission rates vary significantly depending on the type of contract you are trading. It is crucial to understand these costs before you execute a trade.
Commission Rates by Contract Type
The following table outlines the standard commission rates for different asset classes. All commissions are charged per lot unless otherwise specified.
| Contract Type | Number of Tradable Contracts | Maximum Leverage | Commission (Fee) |
|---|---|---|---|
| Forex | 61 | Up to 500:1 | $6 per lot |
| Precious Metals | 8 | Up to 500:1 | $6 per lot |
| Commodities | 11 | 20:1 | $3 per lot |
| Oil | 2 | Up to 500:1 | $3 per lot |
| Indices | Nikkei225 | Up to 500:1 | $0.1 per lot |
| HK50 | Up to 500:1 | $1.5 per lot | |
| HKTECH | Up to 500:1 | $0.5 per lot | |
| Other 19 Contracts | Up to 500:1 | $3 per lot | |
| US Stock CFDs | 78 | Up to 5:1 | $0.04 per lot (Min. $5 per order) |
How Commission is Calculated
For forex, metals, commodities, oil, indices, and US stock CFDs, the commission is calculated using a simple formula:
Commission = Contract Size (in lots) × Commission per lot
Example 1: Index CFD
A trader opens a long position of 0.20 lots on the SP500 index and later closes it.
- Commission = 0.20 lots × $3 = **$0.60**
Example 2: US Stock CFD
A trader opens a long position of 1 lot on an AAPL contract.
- Standard Calculation: 1 lot × $0.04 = $0.04
- However, the minimum commission for US stock CFDs is $5 per order**. Therefore, the actual fee charged is **$5.
- If the same trader opened a 200-lot position: 200 lots × $0.04 = **$8**
Important Note on Account Balance
When you open a position, the MT5 system only checks if your account balance is sufficient to cover the required margin. It does not pre-check for the commission fee. Since the commission is deducted directly from your balance upon opening the trade, you must ensure you have enough funds to cover this cost. An insufficient balance to cover the fee could lead to immediate liquidation of your position.
How Commission is Charged and Displayed
Commission is charged upfront when a position is opened and is directly deducted from your MT5 account balance.
- Important Difference from MT4: The commission is not displayed in the "Trade" tab of the MT5 terminal.
- To view commissions, you must go to the "History" tab. Right-click within this tab and select "Orders and Transactions" to see the full details of a trade, including the commission charged.
Swap Fees (Overnight Financing)
A swap fee, also known as an overnight financing charge or rollover interest, is applied to positions held open past the daily cut-off time (usually 00:00 server time). These fees compensate for the cost of holding a leveraged position overnight.
Swap rates can be positive (credited to your account) or negative (debited from your account), depending on the interest rate differential of the currencies or the asset being traded. You can view the specific swap rates for long and short positions for any contract in the MT5 platform by right-clicking the symbol in the "Market Watch" window and selecting "Specification."
How Swap is Calculated
There are two primary methods for calculating swap fees on MT5 platforms.
1. Calculation in Currency (Common for Indices)
This method is straightforward. The formula is:
Swap = Swap Rate × Lots × Number of Nights
Example: Calculating Swap for a DJ30 (Dow Jones) Position
A user holds a 2-lot long position on DJ30 for 2 nights. The long swap rate is -10.3341.
- Swap = -10.3341 × 2 lots × 2 nights = -41.3364 USD
2. Calculation in Points (Common for Forex, Metals, Commodities, Oil)
This method is more complex and involves the contract specifications. The formula is:
Swap = Lots × Units × Minimum Price Movement × Swap Rate × Number of Nights
Example: Calculating Swap for GAS-C (Gasoline)
A trader holds five 1-lot long positions in GAS-C (total 5 lots) for one night. The short swap rate is -21.9 (used for calculation). The contract specs are:
- Units per 1 lot: 42,000
- Minimum Price Movement (Point): 0.0001
Calculation for one 1-lot position:
- Swap = 1 × 42,000 × 0.0001 × -21.9 × 1 = -91.98 (currency)
Understanding the 3-Day Swap (Weekend Financing)
Financial markets are closed on weekends, but financing costs continue to accrue. To account for Saturday and Sunday, a 3-day swap is applied on a specific night, typically Wednesday.
- Standard Daily Swap: Applied every trading night the position is held open.
- 3-Day Swap (Wednesday): The nightly swap rate is multiplied by 3 to cover the upcoming weekend (Saturday and Sunday).
- This aligns with the T+2 settlement convention standard in many markets.
Example:
If you hold a EURUSD position with a daily swap rate of -0.1 points:
- From Monday to Tuesday night: You pay -0.1 points.
- From Wednesday to Thursday night: You pay the 3-day swap, -0.3 points (-0.1 × 3).
This significantly impacts the cost of holding positions over the weekend and must be factored into your trading strategy. 👉 Explore more strategies for managing trading costs
Dividend Adjustments for Index CFDs
Trading index contracts on MT5 involves another important consideration: dividend adjustments. When companies within an index pay dividends, it affects the index's price, and this is reflected in your account if you hold a position.
What is a Dividend Adjustment?
A dividend is a distribution of a company's earnings to its shareholders. For an index composed of multiple stocks, the aggregate dividend payments from all constituent companies impact the index's value. Brokerages facilitate a dividend adjustment to ensure fair pricing for CFD traders.
How Dividend Adjustments Work
Adjustments are automatically applied to your MT5 account balance on the dividend payment date.
- For Long Positions (Buy): If you hold a long CFD position on an index when a dividend is paid, you will receive a credit. This is because the index price typically drops by the dividend amount, and the credit offsets this theoretical loss in your position's value.
- For Short Positions (Sell): If you hold a short CFD position, you will incur a debit. This is because the index price falls, which is good for a short position, so a debit is applied to balance this theoretical gain.
Dividend Adjustment Example
Assume an index announces a dividend adjustment of $5 per lot.
- You hold a position of 0.2 lots.
- If you are long: You receive $5 × 0.2 lots = **$1 credit**.
- If you are short: $5 × 0.2 lots = **$1 is debited** from your account.
Key Points on Dividends
- Adjustments only occur if you hold a position on the official dividend payment date.
- The adjustment amount is based on the total dividends declared by the index's constituent companies and your position size.
- The process is automatic and requires no action from the trader.
Frequently Asked Questions
How can I check the commission I've been charged on MT5?
Commissions are not visible in the "Trade" tab. You must go to the "Account History" tab within the terminal, right-click, and select "Orders and Transactions" to see a detailed report that includes all commission fees for your closed positions.
Why was my position liquidated even though I had enough margin?
The system only validates your balance against the required margin when opening a position. It does not check if you have enough extra funds to cover the commission. If the commission fee deduction causes your equity to fall below the margin requirement, it can trigger an immediate automatic liquidation.
Is the 3-day swap always applied on Wednesday?
While Wednesday is the most common day for applying the 3-day swap to cover the weekend, it can vary depending on the broker and the specific instrument. Always check your broker's specifications and the swap rates in the MT5 "Symbol Specification" window for exact details.
Can swap rates be positive?
Yes. Swap rates can be either positive or negative. A positive swap rate means you earn a credit for holding a position overnight, while a negative rate means you pay a fee. This depends on the direction of your trade and the interest rate differential between the two currencies in a pair.
How do I know how much dividend adjustment to expect?
The amount is determined by the index provider and your broker. It is based on the total dividends paid by all companies within the index. Most brokers will publish information on upcoming dividend adjustments for index CFDs on their website or within the MT5 platform's news section.
Do all indices and stocks on MT5 pay dividend adjustments?
Dividend adjustments primarily apply to index CFDs and single-stock CFDs. They are only relevant if the underlying companies actually pay dividends. Instruments like forex, commodities, and cryptocurrencies do not have dividend adjustments.