Basics
What is Slippage?
By the verify.trading team · Last reviewed · How we write
Slippage is the difference between the price you expected for an order and the price at which it was filled. It happens when the market moves or liquidity is thin.
Key points
- Most common in fast markets and around news.
- A stop is not a guaranteed exit price.
- Allow for it when sizing risk.
Slippage explained
Slippage can work for or against you, but it is most noticeable on stop orders in fast markets, such as during a major data release, where the market can jump past your stop level.
It is one reason a stop does not guarantee your planned loss, and one reason to size positions with room for error.
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