"Zero commission" is technically true and commonly misleading at the same time. The commission line item genuinely disappears. The cost of running a brokerage doesn't disappear along with it — it just gets folded into a place that's harder to see on a pricing page.
Where the cost actually goes
A broker still has to make money on each trade somehow, and the most common place that cost moves to is the spread itself — the gap between the buy and sell price gets slightly widened, so the cost is baked into every trade automatically rather than itemized as a separate line. It's not hidden in a sinister sense; it's just structured differently, and rarely explained in the marketing that leads with "zero commission."
Spread markup, the most common mechanism
Some brokers offer a genuine choice: a raw, tighter spread plus a separate visible commission per trade, or a wider all-in spread with no separate commission line. Neither is automatically better — the correct comparison is the total cost of a round-trip trade under each structure, not which one has the more appealing headline number.
Other places the cost can hide, beyond the spread
Spread markup is the main one in forex and CFDs specifically, but it's rarely the only one. Depending on the broker, revenue can also come from overnight swap/rollover fees that are wider than the underlying interbank rate justifies, inactivity fees on dormant accounts, withdrawal processing fees, and premium-tier subscriptions for tighter spreads or extra tools. In equities markets specifically (not forex/CFDs), many zero-commission brokers instead rely on payment for order flow — a mechanism the EU has moved to prohibit entirely, while it remains permitted in the US. None of these are unique to any one broker; the point is simply that "no commission" was never a claim about total cost, in any market.
"Zero commission" describes one line item on the pricing page. It was never a claim about the total cost of trading — even though it's marketed to sound like one.
How to actually compare total cost across brokers
Pick a specific, common trade size on a specific, common instrument, and calculate the actual all-in cost under each broker's real pricing — spread plus any commission plus swap and any other fees — rather than comparing headline commission rates in isolation. That single number, total cost per round-trip trade at your typical size and holding period, is the only genuinely fair comparison between brokers.
This isn't automatically a bad thing — the issue is the framing
There's nothing wrong with a spread-only pricing model on its own — plenty of well-run, regulated brokers use it. The issue is specifically when "zero commission" is marketed as if it means "zero cost," because it lets a broker with an actually wider all-in cost look cheaper than one that itemizes its pricing more transparently. Reading past the headline number is the whole fix.
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