Guides · Guide 13
Copy trading fees, explained with a worked example
Four charges, one of them invisible on the leaderboard. On a $2,500 copy of our book they add up to roughly $140 a year plus a tenth of the profit.
- Fees and slippage
- ≈ 3% / yr
- Funding
- ≈ 2.7% / yr
- Profit share
- 10% of profit
The four charges
| Charge | Who sets it | Charged on | Our book, per year |
|---|---|---|---|
| Exchange fees | The exchange, by your fee tier | Every order, maker or taker | ≈ 3% of equity, fees and slippage together |
| Slippage | The market | Every fill, as the gap to the price seen | Included above; measured within ±5 bps on demo |
| Funding | The market, every 8 hours | Every open position | ≈ 2.7% of equity, 2021–26 average |
| Profit share | The lead trader or vault | Your profit only | 10% of profit (Binance default; Hyperliquid vaults) |
The first three are the same whether you copy or trade the strategy yourself; they are the cost of running the book at all. Only the fourth is the price of copying.
Exchange fees
Binance's standard USDⓈ-M futures fees are 0.02% for orders that rest in the book and 0.05% for orders that cross the spread, before discounts for holding BNB or higher volume. What matters is how often the strategy trades. Ours sends about 688 orders a year and turns over about 45× equity, mostly small resizing orders. At a blended 0.07% per unit traded, including slippage, that is roughly 3% of equity a year. A strategy that turns over 5× equity pays a third of a percent; one that scalps at 500× pays a third of the account. Note 02 measures the sensitivity.
Funding
Invisible on most leaderboards and paid by every copier. Across the ten largest Binance perpetuals since 2021 the average rate was 0.0080% per eight hours, about 8.8% a year to a permanent long. Our book, which is short about half the time and holds for days rather than months, paid 2.72% of equity a year on average, most of it in 2021. Note 01 has each year.
Profit share
Charged on net profit, typically settled weekly, and only when there is profit. Binance's default for public portfolios is 10%; Hyperliquid user vaults charge 10% under their published terms. It scales with the good years and disappears in the bad ones, which makes it the least harmful charge of the four: a lead who takes 10% of a 30% year has cost you 3 points and made you 27.
Drift, the fifth cost
Not a charge but a leak. Orders below the exchange minimum are skipped and the copy diverges from the lead. For our book on Binance, 7% of orders are unplaceable at $1,000 and 1% at $2,500. It is the reason for the sensible minimum. Note 06.
A worked year on $2,500
| Line | Amount |
|---|---|
| Allocation | $2,500 |
| Strategy return before its own costs, illustrative | +$900 (36%) |
| Exchange fees and slippage, ≈ 3% | −$75 |
| Funding, ≈ 2.7% | −$68 |
| Net before profit share | +$757 (30.3%) |
| Profit share, 10% of net profit | −$76 |
| Copier's net | +$681 (27.2%) |
Illustrative. The 36% gross figure is chosen to land near the backtest's net return; a real year can be far above or below it, including negative. In a losing year the first two charges are still paid and the profit share is zero.
The lead's published return, if it is honest, is the "net before profit share" line: net of fees and funding. Your result is that figure minus the profit share minus any drift. If a lead's figure is gross of funding, subtract 2–9 points before comparing.