[ Execution ]
Order Execution & Slippage
Two traders with the same idea can get very different fills. Here is what happens between clicking an order and seeing it appear in your account — and how to keep execution costs low.
[ The journey of an order ]
From click to fill in three steps
Understanding each stage — and where it can go wrong — explains almost every confusing fill you will ever see.
You submit the order
You pick the type, size and any trigger or limit levels, then send it on its way.
The clock starts here — the price on your screen is already a fraction of a second old.
Broker routes it
Your order is matched in-house or passed to liquidity providers, depending on your broker's model.
Routing costs time. On a slow link, price can move before your order even arrives.
The market fills it
A limit order fills at your price or better; a market order takes the next available price.
That next available price is rarely the one you clicked — that gap is slippage.
[ Speed ]
How fast an order actually travels
Execution is a relay race, and the baton changes hands in milliseconds. The part of the trip that does not get faster is where slippage is made.
325ms
≈ one blink of an eye
−17%
whole trip faster · machine legs −73%
77%
the slowest leg of the race
Everyday setup — a broker-hosted terminal that routes the order onward to a liquidity provider.
Orange is you; black is the machines. Click a row to read what happens in it.
One-way only — the confirmation back is not included. Indicative timings for a typical account; real figures vary with broker, venue and your connection.
Almost four fifths of this trip happens before your order even exists — spotting the price, deciding, moving your finger. Faster plumbing only shrinks the short end of it, which is why traders who plan the entry in advance get the fills that people who react never do.
You buy speed
- Fills almost instantly at the next available price.
- Price is not guaranteed once the book starts moving.
- The right call when getting in or out now matters more than the exact level.
You buy price
- Fills only at your price or better — zero slippage by design.
- No guarantee it fills; price may never reach your level.
- The right call when the level matters more than the timing.
[ Two costs ]
One you see coming, one you don't
Both come out of the same fill. The difference is whether the price is quoted before you click, or revealed only after it.
Spread — the known cost
The spread is the gap between the bid and the ask, quoted on your platform so you can see it before you trade. On EUR/USD it might be 1.0 pip; on an exotic pair, 20 pips or more.
You pay it every time you cross the spread — which every market order does. Because it is quoted up front, you can build it into your plan instead of being surprised by it.
What 1.0 pip costs on one lot
$10
Slippage — the surprise cost
Slippage is the difference between the price you expected and the price you got. It appears when quotes move faster than your order arrives, or when the book is thin.
Limit orders eliminate it entirely: they can only fill at your price or better. The trade-off is that they may not fill at all.
What this news-time fill cost
$46
1.08450
Before the spike
1.08496
≈ 75 ms after the click — machine time only, your reaction comes before it
4.6 pips
≈ $46 on 1 lot
The 4.6 pips is the whole gap between the price you clicked and the price you got — the spread widening at that moment is already inside it.
[ Total cost ]
Every cost that lands on a trade
Spread and slippage are only half the bill. A complete execution plan accounts for all four costs below — two you know in advance, one you only partly know, and one you can only manage.
| Cost | What it is | When it hits | Known in advance? |
|---|---|---|---|
| Spread | The gap between the bid and the ask. | Every market order, instantly. | Yes — visible before you trade. |
| Commission | A fixed broker fee charged per lot traded. | Billed once as a round-trip fee — entry and exit together. | Yes — published up front. |
| Swap / rollover | Overnight interest for holding a position past 17:00 New York. | Charged for every night the trade stays open. | Mostly — the rate is known, the total depends on nights held. |
| Slippage | The difference between the price you expected and the price you got. | Volatile or thin markets. | No — this is the wildcard. |
$10.00
1.0 pip
$7.00
Round-turn
$5.00
0.5 pip average · 4.6 pips in the news example
$3.20
Overnight debit
$25.20
0.25% of a $10k account
This is one round trip. Twenty-five a month costs $630 — 6.3% of a $10k account, before a single losing trade.
Fills now at the next available price — full slippage.
Spread, slippage and swap are priced off a $10 / pip standard lot. Illustrative figures, not a live quote.
$25.20
= 0.25% of a $10,000 accountSpread and commission are both known before you click. Slippage is not — switch the order type and watch it appear, vanish or spike.
0.25% of the account — under your 0.50% limit.
[ Where execution cost is set ]
Spreads are quoted by the broker, not by the market
The four costs above are the same everywhere in name — the numbers behind them are not.
Partner links — this site may earn a commission at no extra cost to you. It never changes what we write.
[ Timing ]
Liquidity changes through the day
The deeper the book, the tighter the spread and the less slippage you suffer. On EUR/USD you pay roughly 2 pips in a quiet Sydney hour and roughly 0.4 pips in the London–New York overlap. At $10 a pip on a standard lot that is $4 to $20 per lot, on every single fill.
| Session | Hours (GMT) | Liquidity | Typical EUR/USD spread |
|---|---|---|---|
Sydney | 22:00 – 07:00 | Low | 1.8 – 2.5 pips |
TokyoLive | 00:00 – 09:00 | Medium | 1.2 – 1.6 pips |
LondonLive | 08:00 – 17:00 | Very high | 0.6 – 1.2 pips |
London–NY overlap | 13:00 – 17:00 | Peak | 0.3 – 0.6 pips |
New York | 13:00 – 22:00 | Very high | 0.6 – 1.2 pips |
Tokyo and London are both open — the tighter book is London at about 0.6 – 1.2 pips on EUR/USD.
Hours shift one hour earlier when London, New York or Sydney moves to daylight saving. Spreads are indicative, not a live quote.
[ Risk tools ]
Execution is not just about entry
The orders attached to a trade decide how it ends. These four do most of the work.
[ Common misconceptions ]
What traders blame — and what actually happens
Execution is where emotion meets mechanics, so myths flourish. Each one below costs more in discipline than any spread ever will in money.
“My broker hunts my stop-loss”
The stop fills, then price turns straight back. You picked the level yourself, so a loss that reverses seconds later feels like someone reached in and took it.
Stops sit at visible round numbers, so they cluster at the same few levels. When price reaches one, every triggered order hits the market at once and pushes it through — then the burst is spent, the selling it created is gone, and price drifts back to where the real flow sits. That round trip is what looks like a hunt, and no broker had to be involved.
“Slippage only ever happens to me”
You notice it most when it costs you money, so it dominates your memory of an otherwise fine session.
Slippage is a market-wide event. When liquidity thins or news hits, every participant on that instrument is repriced at once — and it sometimes lands in your favour, which the same memory quietly drops. It is the market moving, not your account being singled out.
“A limit order guarantees I get filled”
A limit order sitting on the chart looks like a done deal, so traders build a plan around a fill that never arrives.
A limit guarantees price, not a fill. If price never reaches your level, nothing happens at all; if it only touches it, a thin book can leave you part-filled — half a position while the move runs without the rest of it.
[ Checklist ]
Five habits that cut execution cost
None of these need a better broker or a bigger account. They are decisions made before the order leaves your platform.
Each of these lowers what a single fill costs. None of them rescues a weak setup, and waiting for the tighter session can mean missing the entry altogether. A saved spread on a trade you never took is no saving at all.
Three of the five are aimed squarely at slippage — the only one of the four costs you cannot price in advance.
Set your stop and target when you enter, not after the trade turns.
An exit decided mid-move usually goes out as a market order, straight across a spread that has already widened.
Keep stops off the round numbers everyone else is watching.
Triggered stops cluster at those levels. When price reaches them the orders pile through and the fill lands past your stop.
Stay out of market orders for the first seconds after a release.
Both costs spike at the same moment — the 4.6-pip fill above happened in the 75 ms it took the order to travel, after you had already clicked.
Match the order type to the session, not just to the setup.
On majors the London–New York overlap is where spreads are tightest. In a quiet Sydney hour the same fill can cost five times as much in spread — $20 instead of $4 — while commission and swap do not move at all.
Price all four costs into the plan, not just the spread.
Spread and commission are quoted before you click, swap accrues every night you hold, and slippage is the one you can only manage.
[ FAQ ]
Execution questions, answered
The execution and slippage questions traders ask most — answered plainly.
Browse the full glossaryThe spread is the gap between the bid and the ask, and it is known before you trade. Slippage is the difference between the price you expected and the price you were actually filled at — it appears only when the market moves faster than your order arrives. The spread is a cost you can see in advance; slippage is a cost you feel afterwards.
[ Next step ]
Now put that fill next to the other three
You have seen what happens between clicking and being filled. Compare the four order types side by side and pick the one whose trade-off fits the way you actually trade.