Types of spreads in Forex.

Most brokers currently offer their clients several spread options, depending on their chosen account type.

Which option is more advantageous and best suited to a particular strategy?

The choice isn't vast: cent accounts typically offer a fixed spread, standard and ECN accounts offer a floating spread, and sometimes a commission per lot or trading volume is simply offered.

Fixed spreads —it seems like nothing could be better than a fixed spread: you always trade with the same commission and don't have to constantly monitor the spread.

But the fixed spread is typically poor, rarely reaching 1 pip, and only for the EURUSD currency pair. This means that if you trade with high leverage or simply open a lot of short-term trades, a high spread will eat into your profits.

Therefore, its fixed version is more suitable for medium-term and long-term trading, when a couple of points do not play a special role.

Floating spread - also has its advantages and disadvantages. The main advantage is that, in a highly liquid market, you can get a virtually zero spread of 0.2-0.5 pips.

But at the same time, this moment must be seized, and an excessive increase in this indicator during times of low liquidity can completely deprive the point of conducting 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 based on the trade volume. For example, $50 per $1,000,000, regardless of the currency you're trading.

A floating spread is usually added to this commission, so the overall fee is no different from other types of commissions.

The lot commission 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 the special spread indicator, sometimes it turns out that even a fixed spread can change its values.