What Is a Forex Rebate? How Rebates Lower Your Trading Cost

2018-10-01

Where your trading cost comes from

Every trade has a cost: the spread (the gap between the buy and sell price) and, on some accounts, a commission per lot. The more you trade, the more you pay.

What a rebate is

Brokers pay introducing partners for the clients they refer. A rebate website such as WHFYW passes part of that back to you, as a fixed amount per lot or as a percentage. Your trading conditions with the broker stay the same.

Real trading cost = spread + commission - rebate

For example, with a rebate of USD 3 per lot and 10 lots traded in a week, the rebate for that week is USD 30. Rebate rates and cycles differ by broker; see each broker page.

A rebate is not a profit

Rebates lower your cost but do not change the risk of trading. Do not trade more just to earn rebates.

How to avoid fake brokers

• Verify the licence number on the regulator's own register, and check the website domain listed there.
• Watch for clone firms that copy the name of a real regulated company.
• Be careful with promises of guaranteed returns or pressure to deposit more.
• Read the client agreement to see which company you actually contract with.
• Start with a small withdrawal to test the process.