Bid-Buy = Spread Flashcards
1
Q
How do spreads affect my trades
A
They are variables and change depending on market conditions.
Widely traded pairs=lower spreads due to ease of brokering.
Exotic Pairs=Higher spread due to difficulty of brokering
Trading in session= lower spreads
Trading out of session = higher spreads
2
Q
How do spreads affect my trades
A
Wide spreads hurt profitability
You pay a commission depending on the size of your trade.
Bigger purchase bigger commission
Think of a realtor
3
Q
Who sets the Bid/Ask price?
A
We (The Market)
Demand + supply = short/price increase
High supply+low demand= surplus/price decrease
