What is SPREAD

SPREAD is the difference between BID (SELL)price and ASK (BUY) price and it is measured in PIP points.

SPREAD on the same currency pair differs broker by broker, and also differs in time.

In case you have FIXED SPREAD account type, you can relax, but with VARIALBE SPREADS you will pay you broker SPREAD according to actual market demand.

E.g. during peak times when the demand from retail traders is higher, you broker will increase the spread to satisfy the higher demand.

Imagine the following scenario now

EURUSD currency pair has SELL price of 1,2000 and BUY price of 1,2002 ..

Now the difference is 2 PIP and that is the SPREAD you pay to your broker!

Please always keep in mind that:

SPREAD will always determine your final profit or loss when you exit the trade!

Therefore it is strongly advised to choose a broker that will offer you the smallest spread possible! For example, trading with the top platform HotForex you will pay very low trading fees because their spread is starting from only 0.1 pips for the most traded EURUSD pair.

You should also learn:

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