Glossary
Slippage
The difference between the price you expected and the price you actually got on a fill.
Slippage, explained
Slippage is the gap between your intended execution price and the price your order actually fills at. It happens when price moves between your click and the broker's fill, most often during fast markets and around news releases.
Slippage can be negative (a worse price) or positive (a better one), but in volatile conditions it tends to work against the trader entering with market orders. Stop-loss orders can also slip through your level in a fast move, filling worse than planned — which is why a stop is a risk cap, not a guarantee of the exact exit price.
There is a structural reason it happens: a market order or a triggered stop must match against the best available resting liquidity, and if price has gapped past your level, the next available price is wherever the order book still has size. In genuinely thin moments that can be several pips away.
You reduce slippage by avoiding market orders into high-impact news, trading liquid pairs in active sessions, and using limit orders where the entry price matters more than guaranteed execution. A limit order, by definition, cannot slip to a worse price — it just may not fill.
On the desk we time entries to avoid the worst slippage windows and prefer limit entries at our levels. We also size trades on the assumption that a stop might slip slightly, so a small amount of negative slippage never turns a planned 1% loss into something materially larger.
Frequently asked questions
- What causes slippage?
- Fast price movement between your order and its fill, usually during news releases, session opens, or thin liquidity. The order matches the next available price, which in volatile moments can be several pips from where you intended.
- How do I avoid slippage?
- Trade liquid pairs in active sessions, avoid market orders into high-impact news, and use limit orders where entry price matters. A limit order can never fill at a worse price than you set — though it may not fill at all.
Related terms
Spread
The gap between the bid and ask price — the built-in cost of opening a trade.
ReadLiquidity
The pools of resting orders price is drawn toward — typically clustered above highs and below lows.
ReadTrading Session
The major market hours — Asian, London and New York — that shape liquidity and volatility through the day.
ReadLimit Order
An order to buy or sell at a specified price or better, rather than at the current market price.
Read
Put it into practice
Education modules
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Vocabulary is the easy part. See how the desk turns these concepts into structured trades with defined risk on every position.