Types of spreads on Forex.

Currently, most brokers offer their clients several spread options, depending on the account type they choose.

Which option is more profitable and suitable for a particular strategy?

The choice is not so great, usually cent accounts offer a fixed spread, standard and ECN accounts offer a floating spread, sometimes there is simply a commission on the lot or trading volume.

Fixed spread - there seemed to be nothing better than a fixed spread, you always trade with one commission and there is no need to constantly monitor changes in the spread.

But as a rule, the size of the fixed spread leaves much to be desired; in rare cases it is equal to 1 point, and then only for the EURUSD currency pair. That is, if you trade with high leverage or simply open a lot of short-term trades, a high spread will take away most of your profits.

Therefore, its fixed option is more suitable for medium- and long-term trading, when a couple of points does not matter much.

Floating spread - also has its advantages and disadvantages. The main advantage is that with high market liquidity you can get a practically zero spread of 0.2-0.5 points.

But at the same time, this moment needs to be seized, and an excessive increase in this indicator during low liquidity can completely deprive the meaning of carrying out any transactions; sometimes the value of the floating spread can reach 20-30 points.

Since when using a floating spread the size depends entirely on the liquidity of the instrument itself, the lowest spread can only be provided largest forex brokers.

Commission per lot (volume) - with this option you pay depending on the volume of the transaction. For example, 50 dollars from 1,000,000, regardless of what currency you trade.

As a rule, a floating spread is also added to this commission; as a result, the total fee is no different from other types of commissions.

The commission per lot allows the broker to specify a zero spread in the trading conditions, thereby attracting the attention of clients.

It is possible to check the compliance of the trading conditions specified in the specification only in practice; for these purposes it is used special spread indicator, sometimes it turns out that even a fixed spread can change its performance.