Rebate
What is Rebate on ?
Rebate (from Rebate, also Rebate, Rebate) - implies a discount, which is expressed in the form of a refund of a portion of the spread (commission) charged by the broker in the course of trading operations.
The broker pays its rebate-partners a reward, which is a part of the spread from each transaction of a client who has registered with the broker under the affiliate program. From this remuneration the rebate service returns part of the money to the original client, the trader.
How do I get a spread refund?
Rebate payments are made on both profitable and unprofitable trades.
At the moment, almost all brokers have a spread refund service, but there are also third-party rebate services, working on IB representation models.
In order to receive a rebate payment you must:
- Choose a rebate service and register on his website;
- From the list on the site choose the desired broker;
- Open an account with the broker of your choice;
- Send an application to attach an open or existing account to the administration of the rebate service.
In many brokers the spread refund will be charged automatically immediately after you close a deal, in other brokers the charge is made once a day or once a week. With rare exception - once a month.
As a rule, rebate services pay out money by any convenient way for the raider (QiWi, WebMoney, Yandex.Money, bank card, etc.)
How does the rebate service work?
Payout level of rebate service, for example, is 60%. Trading was conducted on the trading pair GBP/USD, with a spread of 3 points, which at a standard lot is 30$.
Let's assume that 1 order was opened during the week. Regardless of whether there was a loss or profit on it, the rebate service transfers the trader the amount, which is calculated as follows:
30$ (spread) x 0.6 (rebate payout level) = 18$.
This is the mechanism of spread refund. The rebate service returns 60% of 30$, or 18$ of this amount.
How much can I earn on the return of the spread?
It is worth saying that the spread rebate service is an opportunity to earn extra income when trading on the . If you multiply the amount by the number of trades made, for example, during a month, you get a tangible income on rebate payments.
For example, a trader has made 100 trades in a month. In this case rebate service will pay back 18$ x 100 = 1800$. As you can see for yourself, the sum is quite significant.
Why does a broker need a rebate?
Technically, the return of a part of the spread is not complicated and every broker strives to create a large affiliate network in order to attract customers.
Also by reducing or increasing the level of rebate payments, brokers can stimulate interest in currency pairs with less liquidity and higher overall trading costs.
Rebate on: pros and cons
The positive side of rebate services usage is directly proportional dependence of remuneration on the number of performed trades and the opportunity to participate in the bonus and contest programs of rebate service.
The disadvantage for the trader is his desire in the pursuit of increasing rewards to open bоThe number of transactions, which usually leads to a violation of the rules of the money management and the risk of losing a deposit.
Read more about rebate at
More about the spread
- Ask and Bid prices - another key to your profits in the market
- Fixed and floating spreads: what is the catch for the trader?