June 24, 2017

What is forex spread?

Forex spread is the difference between the bidding price and asking price for any currency pair traded in a transaction. For example if buying price is 1.4543 and selling price is 1.4547 then spread will be equal to 3 pips. Remember that spread revolves around the actual price trader has invested in buying particular currency. By using forex spread traders make huge profits through online trading network. If a broker is offering 1.4400 for buying or selling a currency then he will allow to buy this currency at 1.4401 and to sell at 1.4399. Forex spreads represent the way traders make money through transactions. Like wider spread refers to higher buying price and lower selling price which makes difficult to get desired profit.