Free Forex MQL Training
Free Forex, Candlestick Charts, and MetaTrader Training
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| Spread |
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| Written by Al Parsai | |
| Tuesday, 10 February 2009 | |
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Spread refers to the difference between the Ask and Bid price. For example if the Ask for EUR/USD is 1.4115 and Bid is 1.4110 then spread is 0.0005. We usually state spread in pips. In this example the spread is 5 pips. Spread is usually the main source of income for a forex market maker. They, however, may increase the size of spread for different reasons such as a volatile market condition. We call this incident slippage.
Spread plays an important role in some methods of trading such as scalping.
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| Last Updated ( Tuesday, 03 March 2009 ) |
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