What is a foreign exchange spread?
- 8월 10, 2017
- by
What is a foreign exchange spread?
I can often hear about spreads in forex trading.
So what is a spread?
You can think of a spread as the difference between buy and sell prices. We have a principle that spreads are as low as liquidity. The reason for this is that as the number of people who make transactions increases, so does the price.
For the most traded EUR / USD, the spread is set low.
On the other hand, if the currency is not well traded, the spread will be higher.
The spread in foreign exchange transactions is different for each broker. It is this spread that you have to compare to find a good foreign exchange broker.
Avoid brokers who set high spread costs.
This is because many brokerage firms are setting high spreads and taking advantage of client's costs.
When you are looking for a good Forex brokerage, compare those that offer low spreads.
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