One bill is a percentage a year, the other a few pounds an event. Neither says anything about the other until you fix how many events.
Two bills quoted in units that do not meet
A FTSE tracker charges a percentage of whatever you hold, every year, whether the index rises, falls or does nothing. A traded position on the same index charges you on the way in, again on the way out, and once more for every night in between. One behaves like rent and the other like a toll, and nobody subtracts a toll from a rent without counting the journeys. That journey count is the missing term, and the only one neither side can supply. The fund publishes its ongoing charge, the broker its spread and financing rate. How often you will deal this year is a fact about you, and most people asking which route is cheaper settled it before they started reading.
What a year of holding costs, and what one round trip costs
Begin with arithmetic nobody argues with. On GBP 10,000, one basis point is one pound. An ongoing fund charge of 0.10% is GBP 10 a year, a platform fee of 0.25% is GBP 25, and the combined bill lands near GBP 35. Both rates are illustrative: the shape of the sum matters more than the decimal.
Two properties matter more than size. It accrues daily whether or not anybody looks, so it runs through a year in which you make no decisions. And it scales with the money rather than the activity: double the holding and it doubles, double the decisions and it does not move.
The trading side bills by event. You cross a spread going in and cross it again coming out, and commission, where charged, lands per side. If the trade survives the close, financing applies to the full exposure rather than the deposit you posted, and again the next night. Three of those fire because you acted. The fourth because time passed.
On a live funded raw-spread account in July 2026, an intraday round trip on a standard lot came to about GBP 5.30 all in, against roughly GBP 8.00 on the commission-free version of the same account. Bills paid, rather than rates advertised. They were paid on a currency pair.
| Cost line | How it is quoted | What triggers it | Per GBP 10,000 |
| Fund ongoing charge | A percentage a year | Any part of the year held | GBP 1 a basis point, GBP 10 at 0.10% |
| Platform custody fee | A percentage a year, sometimes capped | Holding any balance | GBP 25 at 0.25%, whatever you do |
| Dealing charge, tracker | Pounds per deal | Each buy and each sell | Twice a round trip |
| Bid and offer, tracker | Points around the quote | Each buy and each sell | Crossed twice, itemised nowhere |
| Index CFD or spread bet spread | Points around the broker’s quote | Each opening and closing | About 53p to 80p, scaled from a standard lot |
| Overnight financing | An annual rate, charged nightly | Every night it survives | On the exposure, not the deposit |
Rows one and two use illustrative rates. Rows five and six were recorded on a funded raw-spread account in July 2026.
How many months of holding does one round trip buy?
Scale the funded figures to the same GBP 10,000 first, because they were recorded per standard lot and a standard lot is roughly GBP 100,000 of exposure. That turns an all-in round trip of GBP 5.30 to GBP 8.00 into something between 53p and 80p on this much money. Against GBP 35 a year, a shade under GBP 3 a month, one round trip costs about five to eight days of simply owning the thing.
Run that out to a trade a week and the comparison lands somewhere most people do not expect. Fifty-two round trips comes to roughly GBP 28 to GBP 42 a year, against GBP 35 to hold the tracker and do nothing. Weekly trading costs about what ownership costs, give or take a fifth either way. The gap people imagine between the two is mostly not a cost gap at all, which moves the argument onto whether the trading earns anything, where it belongs.
Run it the other way and it turns mild. Twelve round trips, one a month, comes to roughly two years of the tracker’s charge. Somewhere between four and seven a year the two bills are the same size. Below that, trading is the cheaper habit. Above it, the gap widens by an amount calculable to the penny, while the gain that would have to cover it cannot be calculated at all.
Both sides are being scored on an exam neither one sat
The comparison is unfair to the tracker first. Its charge looks trivial only in the year you examine. It applies to a holding designed to sit still for decades, deducted from a return the fund exists to track rather than beat, so it subtracts permanently from the point of owning it. Calling GBP 35 small is a judgement about one year, and nobody buys a tracker for a year.
It is just as unfair the other way, because almost nobody buys an index CFD instead of a tracker. They buy it to be short, leveraged, or flat by Friday, and no fund sells any of those. Comparing on cost prices a feature set against a fee. Exposure, direction, holding period and whether the view was right are four more inputs, and the last swamps the rest.
The measured numbers came off the wrong instrument
The GBP 5.30 and GBP 8.00 above were recorded on EUR/USD, on one broker’s account, in one month. Carrying them to a FTSE 100 position is an extrapolation, since index quotes behave differently around the cash open and close. The size of that error is unknown and so is its sign.
The reviewers who publish figures of this kind at all are the ones who paid a real deposit to obtain them, and theinvestorscentre.co.uk/trading/best-ftse-trading-platform/ sits on a site that opens and funds live accounts with its own money to test UK trading platforms rather than compiling rankings from providers’ published fee schedules.
It buys something real and creates a problem. Funding an account buys precision about one instrument in one month, while any page helping somebody choose where to trade an index has to speak about a market, across conditions, over a useful period. Generalising is what funding the account was meant to stop anyone doing, and naming the instrument and the month beside every figure leaves a messier comparison than tables quoting nothing.
The largest line in the comparison is not a charge at all
Everything above prices what leaves. On a British index the bigger number is what arrives. A tracker holds the shares, so the dividends the constituents pay reach the fund and, in an accumulating share class, go back into it. The FTSE 100 level a broker quotes is a price index, which excludes them, so the two are not watching the same series even when the screens agree.
Providers close that gap with a dividend adjustment, credited to a long position and debited from a short one on the ex-dividend date, and it lives in the product terms rather than on any comparison table. It is a transfer rather than a fee, so calling it a cost overstates it. What it establishes is that a year long an index derivative and a year owning the index are different economic positions before a single charge is counted. Treatments vary by provider, and this one was read off documents, not off a statement.
Which number would actually change your mind?
One figure settles this, and it is already on your statements: the total you were charged in dealing costs last year. Not the trades you meant to make. The money that actually left. Divide it by the monthly cost of holding the same sum and the answer arrives in the only unit that means anything here. GBP 350 of charges against GBP 3 a month is ten years of ownership spent in twelve months.
Then the harder question, which no arithmetic answers. If the sum came out against your habit, would you change the habit?
Notice what the two bills are selling. The tracker’s charge is the price of a decision you have stopped making, levied quietly for as long as you leave it alone. The dealing bill is the price of carrying on making it, and it arrives whether the decisions were good or not. That is the choice underneath the arithmetic, and the arithmetic will not make it.
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