I have bought a German bond in Degiro (flatexDEGIRO). Specifically, BUNDANL.V.16/26, ISIN: DE0001102408 . The broker says they only charge 3 euros for the purchase. However, when you read their ORDER_EXANTE_FEE_REPORT.pdf file, they are also referring to "spread costs" of around 1% of the purchase amount. This can even be hundreds of euros.
I bought the bond with a limit buy on the Bid price.
What does "Spread costs" mean in this case? Why are they so high? It is most of the future revenue generated by the interest of the bond until maturity.
Submitted August 01, 2023 at 03:50AM by Yepnop https://ift.tt/sNHPVfd
