The formula
per trade = max(amount × percentage, minimum) · round trip = twice that
Where it comes from
Commission is a percentage with a floor underneath it, and on small trades the floor is what you actually pay. Since you pay to get in and again to get out, the cost that matters is the round trip and the rise needed to cover it.
How to work it out by hand
- Work out the percentage commission on the trade
- If it is below the minimum, the minimum applies instead
- Double it for the round trip, and add any annual custody fee
- Divide the total by the trade size to see the rise needed to break even
What is worth knowing
The minimum commission is what makes small, frequent trades so expensive. Below the break-even size — 2,500 in this example — you pay the same fee regardless, so a 200 trade costs 5% round trip before the market has done anything. Above it, the percentage takes over and the cost stops mattering much. Two things people forget when comparing brokers: custody fees are charged whether you trade or not, and the spread between bid and ask is a real cost that never appears on a statement and is often larger than the commission itself.