Spread

The spread is the difference between the buying price (ask) and the selling price (bid) of a currency pair. It represents the primary cost of entering a trade and is how most brokers earn revenue on retail forex transactions. Spreads vary by pair, broker, and market conditions. Majors like EUR/USD typically have tight spreads of 0.1 to 1.5 pips, while exotic pairs can see spreads of 20 to 100 pips or more.

Spreads can be fixed or variable. Fixed spreads stay the same regardless of market conditions, offering predictability but potentially wider average costs. Variable spreads (also called floating spreads) change with market liquidity and volatility. During London and New York session overlaps, variable spreads on majors can be fractions of a pip. During low-liquidity periods like the Asian session open or around major news releases, spreads widen significantly to reflect increased risk for liquidity providers.

For example, if EUR/USD has a 0.8 pip spread with bid 1.0849 and ask 1.08498, entering 1 standard lot costs about $8 just in spread. A profitable trade must first cover that cost before producing real gains. Over 100 trades, a consistent 0.8 pip spread costs $800. Trading a pair with 3 pip spread instead would cost $3,000 across the same 100 trades, which is why active traders prioritize brokers with tight pricing.

In copy trading, spread is a direct cost on every trade and accumulates across hundreds of positions. SteadyFlowFX's 9 algorithms trade across 8 currency pairs, and tighter spreads on your broker account mean results that more closely track the master account's verified performance. When selecting a broker for copy trading, compare the average spread on each of the traded pairs during your typical session.