TradeStation Help

About Strategy Costs

There are six areas that you can modify to better control the costs of your hypothetical trades: initial capital, interest rate, commission, slippage, margin, and trade size. A brief description of each setting is given below. For specific details on how to apply these settings, see Adjusting Strategy Costs.

Initial Capital

The amount of capital required to trade in the selected strategy in the chart. TradeStation uses the initial capital you enter in the Strategy Performance Report.

Interest Rate

TradeStation uses the interest rate in the Strategy Performance Report.

Commission

The amount you pay your broker per contract or transaction is commission. TradeStation enables you to specify commission as currency amount per unit (per contract/share) or per transaction (regardless of number of contracts/shares). TradeStation calculates commissions once for an entry and once again for an exit.

When you choose the Per Unit option, TradeStation multiplies the value you enter in the Commission box by the number specified in the Fixed Unit box and subtracts this value from the strategy's profit/loss for each trade. In this case, TradeStation assumes you have selected the Fixed Unit option under Trade size.

When you specify Commission as Per Transaction, TradeStation ignores any numbers you enter under Trade size, and for each trade, subtracts the value in the Commission box from the strategy's profit/loss. In this case, TradeStation assumes you have selected the Dollars per Transaction option for Trade size and that your commission is a fixed currency amount Per Transaction.

The default commission amount is zero.

Slippage

Hypothetical filled orders are shown in the Strategy Performance Report at the price specified by the criteria of your trading strategy. TradeStation allows you to adjust profit and loss figures for slippage in order to reflect realistic profit/loss results.

You can enter slippage as Per Unit (per contract/share) or as Per Transaction (regardless of number of contracts/shares). TradeStation accounts for slippage once for an entry and once again for an exit.

When you choose the Per Unit option, TradeStation multiplies the value you enter in the Slippage box by the number specified in the Trade size - Fixed Unit box, and for each trade, subtracts this value from the strategy's profit/loss. In this case, TradeStation assumes you have selected the Fixed Unit option under Trade size and that you entered the slippage you expect on a per contract basis.

When you choose the Per Transaction option, TradeStation ignores any numbers you enter for Trade size and for each trade, subtracts the value in the Slippage box from the strategy's profit/loss. In this case, TradeStation assumes you have selected the Per Transaction option under Trade size.

The default commission amount is zero.

Margin

This setting applies to futures only.

Trade Size

The Trade size setting is used by TradeStation in two ways:

TradeStation enables you to set either a specific number of contracts/shares to trade each transaction or the amount per transaction along with a minimum lot size.

If you specify the number of contracts/shares to trade directly in your trading strategy, using EasyLanguage, then any trade size information in the Strategy Properties for all Strategies window is ignored.

When you choose the Dollars per Transaction option and enter a currency amount and minimum lot size, TradeStation determines based on the contract/share price, whether the currency amount specified is enough to trade the minimum lot size. If it is, the hypothetical order is generated. If it is not, the order is not generated.

When you choose the Per Unit option for commissions or slippage, the currency amount entered in the Commission or Slippage box is multiplied by the number you enter in the Fixed Unit box. This total value is subtracted from the profit/loss reported in the Strategy Performance Report. Therefore, it's important that when you choose Per Unit, you correctly specify the number of contracts/shares to trade.

When you choose the Per Transaction option for commissions or slippage, the currency amount entered in the Commission or Slippage box is subtracted from the profit/loss reported in the Strategy Performance Report (once per trade). Any numbers you enter in Trade size (or in your EasyLanguage instructions) are ignored in the calculation.