Understanding the other side of your trade is the fastest way to see the costs clearly — and to stop believing the platform is either a charity or a casino rigged against you.
The spread is the engine
Every quote is wrapped around the underlying market's price: you buy slightly above it and sell slightly below it. That wrap is revenue on every single trade, win or lose, from every client. It's why providers prosper on activity — and why the marketing of this industry historically pushed frequency until the FCA's 2019 incentive ban stopped the worst of it.
Financing and premiums do the rest
Overnight financing on rolling bets is charged at a benchmark rate plus a markup for longs and minus one for shorts — the provider keeps the gap between the two, exactly like a bank's borrowing and deposit rates. Guaranteed-stop premiums, and at some firms inactivity or data fees, top it up. The costs page prices all of these from your side of the trade.
What happens to your bet
Your bet is a contract with the provider, not an order in the underlying market. Internally, clients betting long and clients betting short cancel each other out; the firm then hedges whatever's left over in the real market. Run that way, the provider genuinely doesn't care whether you personally win — it earns the spread and financing either way.
The honest bit: A-book, B-book
Not every firm hedges everything. Hedged flow is called A-book; risk the firm keeps — where the provider profits directly when those clients lose — is B-book. Most retail firms run a blend, using data on which accounts tend to lose. It isn't illegal and, given that published loss rates run 60–90%, it's often profitable. Your protections are FCA conduct and best-execution rules, the loss-rate disclosure itself, and the fact that pricing is anchored to the real underlying market — a firm can't simply invent prices against you.
So does the provider want you to lose?
The system's honest answer: it wants you to trade. A client who loses everything in a week generates less lifetime spread than one who survives for years — which is why the durable firms now lead with education and risk tools. Treat the relationship as it is: a counterparty with a published edge (the spread), regulated conduct, and no interest in your discipline. The discipline part is yours — start with risk management.
The rule that outranks every guide: never bet more than you can afford to lose.
Risk management →