Sometimes slippage too high in profit trade it goes upto 2.5 to 3% profit difference
I would like to clarify that slippage is not specifically based on whether a trade is favourable or unfavourable; it can occur in either direction depending on the actual execution conditions at the time of the trade.
Slippage is an inherent part of algorithmic and market-based trading, and it cannot be represented accurately using a fixed percentage for every trade.
The actual slippage can vary from one trade to another based on several factors, including the instrument being traded, available liquidity, order size, bid-ask spread, volatility, and the prevailing market conditions at the exact time an order is executed.
In a liquid and relatively stable market, an order may be executed very close to the expected price, resulting in negligible slippage. In some cases, the execution may even be better than the expected price, resulting in favourable slippage. During periods of sharp price movement or higher volatility, the difference between the expected and actual execution price can be comparatively higher.
Therefore, a difference observed in a particular trade can occur depending on the market and execution conditions at that moment.
I hope this provides some clarity.
1 Like