You asked for one price, got another instead:slippage is the difference, plainly said.
The difference between the expected price of a trade and the actual price at which it is executed.
Slippage commonly occurs during high volatility or low liquidity periods.
In plain words
Slippage is the difference between the price a trader expected for an order and the price at which it was actually filled. It arises because the price can move in the moment between sending an order and its execution, or because not enough is available at the expected price to fill the whole order.
See it move
Slippage: the distance between Fill price and Expected price
Why it matters
It is most common when prices move fast, such as around major news, or when few orders are resting in the market, such as when trading reopens after a weekend. It affects market orders and stop orders, including stop losses, which become market orders once triggered.
Worked example
An example only. The figures are round and invented for the arithmetic: they are not market prices.
A trader sends a market order to buy one standard lot of EUR/USD with a buying price of 1.1000 on screen.
- 1The order is filled at 1.1002.
- 2Slippage1.1002 − 1.1000 = 0.0002, which is 2 pips.
- 3Cost2 × 10 US dollars = 20 US dollars.
The trade starts 20 US dollars worse than expected; had the fill been 1.0999, the slippage would have been 1 pip in the trader’s favour.
A common mistake
Slippage is not always against the trader. A fill can also be better than the expected price, which is called positive slippage.
Check yourself
Learn more
- Academy lessonScheduled news and how markets reactThe economic calendar, the releases that most often move currencies, why the surprise matters more than the number, and the risks at release time.
- Academy lessonExpert Advisors and how they runWhat an Expert Advisor is, how it runs inside MetaTrader, how automated trading fails in operation (connection loss, requotes, restarts, version changes) and what a VPS is for.
- ExplainerECN and standard accounts: two ways of paying for a tradeA standard account folds the cost of trading into the spread. An ECN account shows a raw spread and charges a commission. The difference is in how the cost is presented.
Educational information, not investment advice or a recommendation to trade.