Round Trip Cost
Round trip cost is the total cost of entering and exiting a position. It typically includes the spread both ways plus fees on both sides.
Definition
Round trip cost is the total cost paid across both sides of a trade: entering and later exiting.
Why it matters
Many traders underestimate how quickly costs compound. A strategy can look good on entry but become negative once you include the cost of getting out.
How to think about it
• If you cross the spread to enter and cross again to exit, the spread component is paid twice.
• Fees often apply on both sides, so fee cost can also double.
• In thin markets, slippage can increase the round trip cost beyond what the quoted spread suggests.
Common pitfalls
Assuming you can exit at the same spread: Spreads can widen, especially near resolution or around news.
Ignoring partial exits: Exiting size can cause additional slippage and price impact.