What is Broker Spread?
The trading fee most often overlooked by beginners, despite having a major impact when your trading volume is high.
Definition of Spread
Spread is the difference between the bid price (selling price) and the ask price (buying price) of an instrument. For example, if EUR/USD shows a bid of 1.0850 and an ask of 1.0852, the spread is 2 pips. Every time you open a position, you automatically "pay" this spread—not as a separate fee that appears on your statement, but embedded within the price difference itself.
Fixed vs. Variable Spread
Fixed spread remains constant regardless of market conditions, making it suitable for traders who need cost certainty. Variable spread (floating) fluctuates based on market liquidity; it is usually very tight when the market is active, but can widen drastically during major news releases or quiet trading hours. ECN/Raw brokers generally use variable spreads that can approach 0 pips, accompanied by a separate commission per lot.
Why Does Spread Matter?
For traders with a scalping style or high transaction frequency, a wide spread can significantly erode profits—even before a position has a chance to move in your favor. The more frequently you open and close positions, the greater the accumulated spread costs you pay throughout the month.
Relationship Between Spread and Account Types
Standard accounts usually feature slightly wider spreads but no separate commission, as the cost is already "wrapped" into the spread. ECN/Raw accounts feature much tighter spreads (sometimes 0.0 pips), but carry a commission per lot paid separately. The total cost for both is often similar; the main difference lies in how it is presented.
Does Rebate Change the Spread?
No. Rebates are calculated from the IB commission paid separately by the broker—they do not reduce or increase the spread you see on your platform. The spread you get through Myfxrebate is identical to what you would receive if you registered directly with the broker without any rebate.
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