Forex glossary
Slippage
The difference between an execution price and a clearly identified reference price on the same side of the quote. It can improve or worsen the result; an unfilled, canceled remainder has no execution price.
Illustrative example
How does it work in practice?
Suppose 10,000 EUR is bought against reference ask 1.1000 and filled at 1.1003 USD per EUR. With a 0.0001 pip, adverse slippage is three pips, or 3 USD before other fees.
A case to work through
Selling at a lower price
Model: planned sell bid 1.0850, fill 1.0847 USD/EUR, quantity 10,000 EUR, pip 0.0001.
- The sale price is lower by 3 pips.
- The shortfall against the plan is 10,000 × 0.0003 = 3 USD.
What follows? Compare bid with a sale fill and ask with a buy fill.
Example boundary: The calculator compares one planned and one actual price, excluding a multilevel book.
An adverse sale-price difference
Text description of the diagram
- Sale plan: Bid 1.0850 USD/EUR.
- Execution: 1.0847: lower by 3 pips.
- Cash impact: 10,000 × 0.0003 = 3 USD less.
A useful distinction
Slippage / spread (bid-ask spread)
Spread compares bid and ask; slippage compares the appropriate plan price with its fill.
Change an assumption, see the result
What changes if…?
Change buy/sell direction and EUR/USD prices; the sign distinguishes adverse from favorable differences.
EUR/USD, one pip = 0.0001. A positive result means execution worse than the reference; a negative result means improvement. Compare prices on the same Bid/Ask side. This does not forecast slippage; commissions and financing are excluded.
Check your understanding
Distinguish adverse and favorable differences for buys and sells.
Show the answer and explanation
Favorable 2 pips, saving 1 USD
5,000 × 0.0002 = 1 USD less expenditure.
Orders, prices and execution quality
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Read the fuller explanation
Related terms
Sources and documentation
- MetaTrader 5: executing trades
Execution modes, requotes, position handling and local trailing on this platform.
Document read: - MetaTrader 5: basic trading principles
Orders, deals and positions; FOK, IOC and partial-filling policies.
Document read:
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