Unless you are capturing the spread... You are paying about half of it = you are fucking toast... I doubt anyone could absorb even a $0.01 spread in the long run. The way you capture a spread... Let's say a $50 stock with a $0.07-0.08 spread that trades 300,000/day (I do this everyday)... You hedge it with a > 90% correlated pair with a $0.01 spread. You are well-hedged... so you can wait 5 or 10 or 30 minutes or overnight... To build up the hedge more or close it out... With every pairs trade you are capturing the big spread... and (mostly) paying the $0.01 spread.... Usually you have a basket of these with 100 long + 100 short.
Can you give some examples of the correlated pairs you use? Aside from that, I was just doing this with BTU. It is not too bad if the supply and demand is clear.
SPY IVV and VOO could make a good starting point... since the 3 etf's are based on the same index and have very different liquidity and spread...