Slippage is the difference between the price you expected to trade at and the price you actually received, and it grows when a book is thin or an order is large.
Last reviewed 29 November 2025 · Educational, not advice
Slippage is the amount by which your real execution price differs from the price you expected when you placed an order. If you saw an offer at fifty cents and your order filled at an average of fifty one and a half cents, you slipped a cent and a half. It is a cost of trading that is separate from both the platform fee and the bid ask spread, although all three can appear on the same trade.
Slippage arises because a market order takes whatever the order book offers at that instant. The order matches against the best price first, and if your size is larger than the amount resting there, the remainder fills at the next price, and the next, walking through the book. Your average fill is the size weighted blend of every level you touched, which is worse than the single best price you first saw. The more levels you climb, the larger the slip.
The biggest slips happen in three conditions, which often arrive together. A thin book, with little resting size near the quote, lets even a modest order walk through levels. A large order relative to the resting size climbs further than a small one. And a fast moving market reprices the book while your order is in flight, so you fill far from the price you last saw. Around fresh news or a resolution moment, slippage and volatility both spike.
You can manage slippage without abolishing it. A limit order names the worst price you will accept and waits, protecting you from a bad fill at the cost of possibly not filling at all. Trading smaller sizes that stay within the resting depth, breaking a large order into pieces, and avoiding the most volatile moments all reduce the slip. The honest approach is to fold the likely slippage, alongside the spread and the fee, into your view of what a trade really costs.
Slippage can occasionally run in your favour when a fast market fills you better than the quote, but for anyone taking liquidity with market orders it tends to run against you on average, because you are the one consuming the resting orders. Treating it as a real and usually adverse cost is the safer mental model, and it explains why the headline price on screen is often not the price you end up paying.
Suppose a thin book has 200 contracts offered at 50 cents, 300 at 51, and 400 at 52. You send a market order for 600 contracts. The first 200 fill at 50, the next 300 at 51, and the final 100 at 52. Your average fill is about 50.8 cents, so you slipped roughly 0.8 cents per contract against the 50 you first saw. A larger order would have climbed further and slipped more.
Illustrative only. Numbers are examples, not a quote or a prediction, and exclude fees.
Reducing slippage lowers your trading cost, not your risk of loss, and a well filled order can still resolve against you. Stake only what you can afford to lose, never to chase a loss, and never on borrowed money. If it stops feeling like a free choice, step back. In the United States you can call or text the helpline on 1-800-GAMBLER or visit ncpgambling.org.
Slippage is the difference between the price you expected when you placed an order and the price at which it actually executed. It appears when a market order takes more size than rests at the best price and fills the remainder at worse prices.
A market order consuming more size than rests at the best price, which makes it climb through the book to worse levels. Thin liquidity, a large order relative to the resting size, and a fast moving market all make the slip larger.
Use a limit order to cap the price you accept, trade smaller sizes that fit within the resting depth, break large orders into pieces, and avoid the most volatile moments. None of these removes slippage entirely, but together they keep it small.
No. The spread is the gap between the best bid and best offer that you cross even on a tiny order. Slippage is the extra cost a larger order incurs by walking through several price levels. They are distinct costs that can both apply to one trade.
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