Slippage
Trading MechanicsThe difference between the expected fill price and the actual fill price of an order. Slippage occurs when market conditions change during order execution.
What Is Slippage?
Slippage occurs when a Market Order or Stop Order is filled at a different price than expected. If you place a buy order at 1.0850 but are filled at 1.0852, you experienced 2 Pips of negative slippage. Slippage can be positive too: if you are filled at 1.0848 on the same buy order, you got 2 pips of positive (or price improvement) slippage.
What Causes Slippage
Slippage happens when the market moves between the moment you submit the order and the moment it reaches the liquidity provider. Common causes include low liquidity (wider gaps between available prices), high volatility (fast price movements during news releases), large order sizes (exceeding available liquidity at one price), and slow execution technology.
Minimizing Slippage
To reduce slippage, trade during high-liquidity periods (London-New York overlap), use Limit Orders instead of market orders when possible, avoid trading immediately around major economic releases, and choose a broker with fast execution and deep liquidity. Some brokers publish execution statistics including average slippage. Our Best Time to Trade Forex identifies the highest-liquidity trading windows.
Related Terms
Requote
When a broker rejects your order at the requested price and offers a new price instead. Requotes happen when the price moves during order processing.
Execution Speed
The time between submitting an order and receiving a fill confirmation. Measured in milliseconds. Faster execution reduces slippage and requotes.
Market Order
An order to buy or sell immediately at the best available price. Market orders guarantee execution but not a specific price.