Fees Are a Silent Tax

You checked the price ten times today.

Did you check what you paid to trade it?

Most traders can tell you their entry, their stop and their "target" from memory. Ask them how much they paid in fees last month and you get the same face as when you ask a tito how much he actually spends on Grab. 😂

Fees don't show up as a red candle. They don't trigger a notification. They just quietly take a slice of every trade, win or lose.

That's why I call them a silent tax.

WHAT YOU'RE ACTUALLY PAYING

There are three costs most people mix up.

1. Trading fees.
The exchange charges you a small percentage every time an order fills. "Maker" orders add liquidity (usually a limit order that waits on the book). "Taker" orders remove it (usually a market order that fills right away). Takers usually pay more.

2. The spread.
The gap between the best buy price and the best sell price. On BTC it's tiny. On a small-cap coin at 3 AM it can be bigger than the fee itself.

3. Funding (futures only).
If you hold perpetual futures, you pay or receive funding every few hours depending on which side is crowded. Hold a crowded position for weeks and funding can quietly become your biggest cost.

Today we're mostly talking about number 1, because it's the one you can reduce the fastest.

THE MATH NOBODY DOES

Let's use a simple example rate of 0.1% per trade. (Your actual rate depends on the exchange, your tier and whether you're maker or taker. Check your own fee schedule.)

Say you're a part-time trader. You trade around ₱50,000 per position, and you open and close about 20 positions a month.

That's 40 fills a month.
40 × ₱50,000 = ₱2,000,000 in total traded volume a month (buys and sells combined).
0.1% of ₱2,000,000 = ₱2,000 a month in fees.

₱2,000 a month is ₱24,000 a year.

That's a phone. Or a few months of Meralco. Or a decent chunk of your yearly returns, gone before you even made a single good call.

And if you run grid bots, the number of fills goes way up. That's the whole point of a grid. More fills means fees matter even more.

WHY THIS HURTS MORE THAN YOU THINK

Fees are charged on volume, not on profit.

You pay them on winners.
You pay them on losers.
You pay them on the trade you closed out of boredom.

A trader who makes 2% a month on their capital but turns that capital over many times can lose a big share of their edge to fees. The more active you are, the more this matters.

This is also why overtrading is so expensive. It's not just the bad entries. It's the toll booth you pass through every single time.

HOW TO PAY LESS

Simple fixes first.

1. Trade less, but better.
The cheapest trade is the one you didn't need to take.

2. Use limit orders when you're not in a rush.
Maker fees are usually lower than taker fees. If you're not chasing a breakout, let price come to you.

3. Know your tier.
Most exchanges lower your fees as your volume or holdings grow. Check where you are.

4. Watch funding on futures.
If you're paying funding every 8 hours on a position you plan to hold for a month, run the numbers first.

5. Get the discount you're entitled to.
Many exchanges give new users a trading-fee discount or rebate when they sign up through a referral link. It's the easiest fee cut there is, because you don't have to change anything about how you trade.

WHERE I TRADE

Most of my bots and a lot of my trades run on OKX. I covered why in Gridbots 101: the interface is clean, the bots are easy to set up, and it covers both crypto and traditional market assets.

Don't have an OKX account yet? Open one here: https://www.okx.com/join/OFF2O and get 20% off your trading fees.

NOW THE BAD NEWS

A fee discount does not make a bad trade good.

If your strategy loses money, cheaper fees just mean you lose money a little more slowly.
If you're using leverage you don't understand, no discount in the world will save you from a liquidation.
And a lower fee is never a reason to trade more.

Fix the strategy first. Then make it cheaper to run.

MY SIMPLE FEE CHECKLIST

Do I know my maker and taker rate?
Do I know my monthly volume?
How much did I pay in fees last month?
Am I using limit orders when I can?
Am I paying funding on positions I forgot about?
Did I claim the discount I'm entitled to?

THE MAIN POINT

You can't control the market.
You can control what you pay to be in it.

Small leaks sink big ships. Plug the easy ones first.

For educational purposes only. Not financial advice. The exchange already takes its cut; don't let your ego take the rest.

Kind Regards,
Zeefreaks