🤔 Is Spread plays a major role in net profit booking in Forex Trading?
Is Spread plays a major role in net profit booking in Forex Trading? 🤔
What is Spread?
Spread = | Ask - Bid |
Why forex broker puts spread?
Can I get Zero Spread Account?
Floating vs Fixed Spread
Thats' why always find regulated brokers with the minimum spread.
How does spread affect profits in trades?
There are 02 points. The first is very simple and easy to understand that if the spread is lowest then you can close the trade-in minimum movement (upside or downside) in profit. In other words, we can close the trade either in profit or at a minimum loss (in case of wrong trade).
The second point is tricky. When we put over TP (Take Profit) at a certain level and our TP falls between ASK and BID price and price return back from that level to the opposite direction. it may be possible we have to book loss in that trade due to spread. because if the spread is lowest the difference between ASK and BID is also low. then the change of surrounding our TP between ASK and BID price is less.
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Spread is the difference between ASK and BID Price which is charged by Forex Broker for maintaining Forex Account and managing expenses. Spread can be fixed or floating. We find the lowest spread in the ECN account but it requires a high initial deposit. Kindly choose Forex Broker wisely so that your profits do not affect due to High Spread.