LEARN TO TRADE · Beginner · 6 min read · 3 Nov 2026 · Navion Pro Research
The Costs of a Trade: Spreads, Swaps and Slippage
Every trade starts with a small cost, and some keep costing for as long as they stay open. This guide explains the three costs traders meet most often, when each is paid, and what makes them bigger.
Trading leveraged products carries a high level of risk to your capital. Losses can exceed deposits. Past performance is not an indicator of future results.
Key Points
- The spread is the gap between the buy and sell price. You pay it as soon as you open a trade.
- The swap is an overnight charge on positions held past the daily cut off.
- Slippage is the difference between the price you expected and the price you got.
- Spreads and swaps change with market conditions, so check the current figures on the platform before you trade.
The spread: the cost of getting in
Every market shows two prices. The lower one is the sell price, and the higher one is the buy price. The gap between them is the spread.
This example is for illustration only. The prices are not real quotes.
- Gold shows a sell price of $3,899.80 and a buy price of $3,900.20. The spread is $0.40 an ounce.
- A trader buys 0.01 lot, or 1 ounce, at $3,900.20. If they closed straight away, they would sell at $3,899.80 and lose $0.40.
- On 1 lot, or 100 ounces, the same spread would cost $40.
Every trade starts slightly behind. The price has to move by the spread before the trade breaks even.
Spreads are usually tighter when a market is busy, and wider when it is quiet or when big news is due.
The swap: the cost of staying in
When you trade a CFD, you put up only part of the position's value as margin, and the rest is effectively funded for you. If you keep a position open past the daily cut off, a financing charge, called a swap, is applied for each night it stays open.
- Buy and sell positions can have different swap rates.
- Swap rates change with market conditions and interest rates.
- A position closed before the daily cut off pays no swap.
For a trade held for a day, the swap is often small. For one held for weeks, it can add up to more than the spread.
Slippage: the cost of a fast market
Slippage happens when an order fills at a different price from the one you saw. It is most common when prices move quickly, such as around big data releases or when a market reopens.
This example is for illustration only.
- A trader places an order to buy gold at the market, expecting $3,900.20.
- In the moment the order reaches the market, the price jumps. The order fills at $3,901.00.
- The slippage is $0.80 an ounce.
Slippage can work in your favour too, if the price moves your way before the order fills.
The three costs side by side
| Cost | When you pay it | What makes it bigger |
|---|---|---|
| Spread | When the trade opens | Quiet markets, big news, larger positions |
| Swap | Each night the position stays open past the daily cut off | Holding for longer, larger positions, changes in interest rates |
| Slippage | When an order fills at a different price | Fast moving markets, market reopenings, large orders |
Every account type also charges a commission on each trade. Check the commission for your account type on the platform.
How to keep costs in check
- Check the spread before every trade. It changes through the day.
- Know the swap before you hold overnight. Check the rate for your direction, long or short.
- Be careful around big news. Spreads can widen and slippage can grow in the minutes around major releases.
- Count costs in your plan. A trade that needs a large move just to cover costs is harder to make work.
- Review your costs. Look back at what each closed trade really cost, not just the price move.
Risk disclosure: Trading involves significant risk of loss and is not suitable for all investors. Past performance is not indicative of future results. This brief is for information and education only. It is not investment advice, a recommendation or an instruction to buy or sell anything. The likely market reactions described here are our assessments of what could happen, not predictions, and markets can and often do move differently. Figures and forecasts come from third party sources and may change. Make your own decisions, and consider independent advice if you are unsure.
