Spread
The difference between the bid (sell) price and ask (buy) price of a currency pair, representing the broker's transaction cost.
What is Spread?
The spread is the difference between:
- Bid price: The price at which you can SELL
- Ask price: The price at which you can BUY
Spreads are measured in pips and represent the cost of entering a trade.
Example
If EUR/USD shows:
- Bid: 1.0850
- Ask: 1.0852
The spread is 2 pips (1.0852 - 1.0850 = 0.0002).
Typical Spreads
| Pair | Typical Spread |
|---|---|
| EUR/USD | 0.1 - 1.0 pips |
| GBP/USD | 0.5 - 2.0 pips |
| USD/JPY | 0.3 - 1.5 pips |
| Cross pairs | 1.0 - 5.0 pips |
What Affects Spreads?
- Liquidity: More liquid pairs have tighter spreads
- Volatility: Spreads widen during news events
- Trading session: Best spreads during London/NY overlap
- Broker type: ECN vs. Market Maker
Use our Currency Strength Meter to identify the best trading opportunities on liquid major pairs.