Glossary

Slippage

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Orders take time to reach the broker and the market can move in that time. The difference between the intended and executed price is slippage. It can be favorable, but in fast markets — exactly when stops trigger — it is usually against you.

Slippage is invisible in naive backtests, which fill every order at the exact requested price. Any serious evaluation of a strategy, especially one trading around volatile sessions, must assume realistic slippage or its results are fiction.

Covered in depth in Lesson 11: Demo und Live sind nicht dasselbe Spiel.

Related terms

• Spread — The difference between the buy (ask) and sell (bid) price — the built-in cost of every round-trip trade.
• Stop loss — An order that closes a position automatically at a predefined worse price, capping the loss on a trade.
• Liquidity — How much volume the market can absorb at current prices — the depth that determines spreads and slippage.