Bid-Ask Spread: The Hidden Fee You Pay Every Trade
Learn what the bid-ask spread is, why it widens, and how spread affects your break-even, win rate, and short-term trading strategies.
The spread is the gap between the highest buyer and lowest seller. You pay it on every round trip.
Why spreads widen
Low liquidity, volatility spikes, and off-peak hours all widen spreads.
Spread impact on break-even
If your target is small, spread can consume most of your edge. Costs pile up fast on short-term trades.
How to trade with spread in mind
- Prefer liquid pairs
- Avoid dead hours
- Use limit orders when appropriate
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