When you trade a financial instrument, such as a Stock, ETF, FX, or CFD, there are always two prices:
- Bid price – the price at which you can sell
- Ask price – the price at which you can buy
The spread is the difference between the bid and ask.
Example
- Bid: 1.907,5
- Ask: 1.909,5
- Spread: 2,00
If you buy one share at 1.909,5 and immediately sell at 1.907,5, the 2,00 difference reflects the spread cost. It is not charged separately and is already incorporated into the quoted prices.
Is it a Saxo direct cost?
No.
The spread is not a separate fee charged by Saxo and it is not deducted from your account as an additional cost.
Instead, the spread is an implicit trading cost that is already included in the buy and sell prices quoted in the market. This means you pay the spread through the price at which you trade rather than through a separate charge.
Why do I see spread costs in the trading ticket?
To provide greater transparency, we display the estimated spread cost in the trading ticket under Investment service costs.
The spread has always been part of the trading price. We display the estimated spread cost separately to provide greater transparency and help you better understand the total cost of trading before placing an order.
Showing the spread separately does not mean you are paying an additional fee. It simply makes an existing cost more transparent.
What do “Spread cost (open)” and “Spread cost (close)” mean?
When you trade, the spread impacts both entering and exiting a position. To help you understand the estimated total cost of a trade, the trading ticket show:
- Spread cost (open) – the estimated spread cost when opening a position
- Spread cost (close) – the estimated spread cost when closing a position
For example, if the spread between the bid and ask price is GBP 2,00, the platform shows the estimated Spread cost (open) of GBP 1,00 associated with opening the trade
This does not mean you are paying two separate spread fees. The spread remains embedded in the bid and ask prices and is not charged separately.
The purpose of showing spread costs as open and close is to provide a more complete estimate of the potential cost of entering and later exiting a position, giving you greater transparency into the overall cost of trading.
Why can the spread change?
The size of the spread is not fixed and can vary over time.
Spreads are typically narrower when:
- Markets are actively traded
- There are many buyers and sellers
- Market conditions are stable
Spreads may become wider when:
- Markets are volatile
- Trading activity is lower
- Liquidity is limited
- The underlying market is closed
For example, if a stock's primary exchange is closed, market participants may have less certainty about its current value. As a result, the spread may widen until the underlying market reopens.