{"id":21568,"date":"2026-10-04T07:16:48","date_gmt":"2026-10-04T07:16:48","guid":{"rendered":"https:\/\/dev.trade.com\/en\/?post_type=trade_hub&#038;p=21568"},"modified":"2026-10-16T07:42:30","modified_gmt":"2026-10-16T07:42:30","slug":"what-are-spreads-in-forex-trading","status":"publish","type":"trade_hub","link":"https:\/\/www.trade.com\/en\/eu\/trade-hubs\/what-are-spreads-in-forex-trading\/","title":{"rendered":"What Are Spreads in Forex Trading?"},"content":{"rendered":"<p>When trading <a href=\"https:\/\/www.trade.com\/en\/eu\/trade-hubs\/what-is-forex-trading\/\">forex<\/a> or <a href=\"https:\/\/www.trade.com\/en\/eu\/trade-hubs\/what-is-a-cfd\/\">CFDs<\/a>, you will usually see two prices for each instrument: the <strong>bid price<\/strong> and the <strong>ask price<\/strong>.<\/p>\n<p>The difference between them is called the <strong>spread<\/strong>.<\/p>\n<p>The spread is one of the main costs of trading. It affects the price at which a position is opened, how far the market needs to move before a trade can become profitable, and the overall cost of entering and exiting positions.<\/p>\n<h3>Key Takeaways<\/h3>\n<ul>\n<li>The <strong>spread<\/strong> is the difference between the bid and ask price.<\/li>\n<li>The <strong>bid<\/strong> is the price at which you can sell, while the <strong>ask<\/strong> is the price at which you can buy.<\/li>\n<li>Spreads are commonly measured in <strong>pips<\/strong>.<\/li>\n<li>Tighter spreads generally mean <strong>lower trading costs<\/strong>.<\/li>\n<li>Spreads can widen during periods of <strong>low liquidity, high volatility, or major economic news<\/strong>.<\/li>\n<li>The spread should be considered alongside <strong>position size, stop loss, and overall risk<\/strong> before entering a trade.<\/li>\n<\/ul>\n<h2>What Are Bid and Ask Prices?<\/h2>\n<p>The\u00a0<strong>bid price<\/strong>\u00a0is the price at which you can sell an instrument. The\u00a0<strong>ask price<\/strong>\u00a0is the price at which you can buy an instrument.<\/p>\n<p>So, if EUR\/USD, for instance, shows:<br \/>\n<strong>Bid: 1.1998<\/strong><br \/>\n<strong>Ask: 1.2000\u00a0<\/strong><br \/>\nThis means you can\u00a0<a href=\"https:\/\/www.trade.com\/en\/eu\/trade-hubs\/what-are-long-and-short-positions-in-forex-trading\/\">sell EUR\/USD at\u00a01.0998, or\u00a0buy it at 1.2000<\/a>. The ask price is\u00a0usually higher\u00a0than the bid price. The gap between them is the spread \u2013\u00a0<a href=\"https:\/\/www.trade.com\/en\/eu\/trade-hubs\/what-are-pips-in-forex-trading\/\">2 pips<\/a> in this case.<\/p>\n<h2>Brokers and Spreads<\/h2>\n<p>While spreads occur naturally in markets, they are also the most common way brokers charge traders for their services.<\/p>\n<p><strong>Forex &amp; CFD brokers will often have a minimal spread<\/strong>. This means that, regardless of market conditions, the spreads\u00a0can&#8217;t\u00a0drop below a certain level.<\/p>\n<p>This is often a very minor spread, equaling a few pips, but it does mean that traders need to perform a little better to remain profitable. Naturally, a broker with lower spreads on your preferred instrument will normally be the optimal option, assuming there are no other charges\/fees.<\/p>\n<h2>Why Do Spreads Change?<\/h2>\n<p><strong>Spreads are not fixed<\/strong>. They can change depending on\u00a0<strong>market conditions<\/strong>, the\u00a0<strong>currency pair<\/strong>,\u00a0<strong>liquidity<\/strong>, and\u00a0<strong>timing<\/strong>.<\/p>\n<p><strong>Major currency pairs<\/strong>, such as EUR\/USD or GBP\/USD,\u00a0<strong>often have tighter spreads<\/strong>\u00a0because they are heavily traded. Exotic pairs, which involve smaller or less commonly traded currencies, often have wider spreads because there are fewer buyers and sellers available.<\/p>\n<p>Spreads can also widen during quiet market hours, around major economic news, during holidays, or in periods of market stress. This is because there may be fewer buyers and sellers available, or because prices are moving too quickly for liquidity providers to quote as tightly as usual.<\/p>\n<h2>Conclusion<\/h2>\n<p>Before opening any trade, check the spread. A setup that looks reasonable with a 1-pip spread may become much less attractive if the spread suddenly widens to 5 or 10 pips.<\/p>\n<p>Spreads significantly\u00a0impact\u00a0the price movement you need for a trade to end up in your favor. Beginners may want to stick to highly traded asset pairs like\u00a0<strong>majors\u00a0<\/strong>and avoid volatile periods like news releases and reports. This will allow them to get familiar with how spreads work in a more reserved environment before moving on to trading patterns that may be more hectic.<\/p>\n<p>The spread should be part of your pre-trade planning, along with your entry, stop loss,\u00a0<a href=\"https:\/\/www.trade.com\/en\/eu\/trade-hubs\/what-are-lots-in-forex-trading\/\">position size<\/a>, and risk. It may seem like a small detail, but\u00a0small details\u00a0matter in forex, especially when leverage and frequent trading are involved.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The spread is the difference between the price at which you can buy and sell a currency pair. Learn how bid and ask prices work, why spreads change, and how this trading cost can affect your results.<\/p>\n","protected":false},"author":6,"featured_media":21618,"comment_status":"open","ping_status":"closed","template":"","meta":[],"trade_hub_cat":[165],"trade_hub_type":[163],"trade_hub_tag":[],"class_list":["post-21568","trade_hub","type-trade_hub","status-publish","has-post-thumbnail","hentry","trade_hub_cat-foundations","trade_hub_type-articles"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v25.6 (Yoast SEO v27.3) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>What Are Spreads in Forex? | Learn Trading With Trade.com<\/title>\n<meta name=\"description\" content=\"Learn what spreads are in forex trading, how bid and ask prices work, why spreads change, and how they affect trade costs and profitability.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.trade.com\/en\/eu\/trade-hubs\/what-are-spreads-in-forex-trading\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"What Are Spreads in Forex Trading?\" \/>\n<meta property=\"og:description\" content=\"Learn what spreads are in forex trading, how bid and ask prices work, why spreads change, and how they affect trade costs and profitability.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.trade.com\/en\/eu\/trade-hubs\/what-are-spreads-in-forex-trading\/\" \/>\n<meta property=\"og:site_name\" content=\"Trade.com\" \/>\n<meta property=\"article:modified_time\" content=\"2026-10-16T07:42:30+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.trade.com\/wp-content\/uploads\/2026\/10\/What-Are-Spreads-in-Forex-Trading_.png\" \/>\n\t<meta property=\"og:image:width\" content=\"535\" \/>\n\t<meta property=\"og:image:height\" content=\"338\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/png\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data1\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/www.trade.com\\\/en\\\/eu\\\/trade-hubs\\\/what-are-spreads-in-forex-trading\\\/\",\"url\":\"https:\\\/\\\/www.trade.com\\\/en\\\/eu\\\/trade-hubs\\\/what-are-spreads-in-forex-trading\\\/\",\"name\":\"What Are Spreads in Forex? 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