A spread refers to the difference between the bid (selling) price and the ask (buying) price of a CFD. It essentially represents the transaction cost when placing a trade.
When traders buy at the market price, they purchase at the ask price, which is higher than the bid price. Conversely, when selling at the market price, they sell at the bid price, which is lower than the ask price. The difference between these two prices is known as the spread.
Tighter spreads can benefit traders by reducing trading costs, allowing for more efficient entries and exits while potentially capturing better price movements.
How does it impact trading?
Spreads directly affect trading costs and profitability. Narrow spreads reduce the cost of entering and exiting trades, making them ideal for active traders. Wider spreads, on the other hand, increase costs, which may impact overall profitability, particularly for short-term strategies.
What spreads do you offer?
At Taurex, we provide tight spreads on most available instruments, including highly competitive spreads for gold trading. Traders can also choose their preferred pricing model by selecting from one of our account types: Standard Zero, Pro Zero, and Raw trading accounts.
For more details and a full breakdown of our spreads, visit our Pricing page.