What it is
Slippage is the difference between the price you expected to trade at and the price you actually traded at. It occurs when market conditions change in the time between you placing an order and your broker executing it.
For example, you place a buy order for EUR/USD at 1.1000. By the time the broker fills it, price has moved to 1.1003. You've experienced 3 pips of slippage — you paid more than you intended.
How it works
Every order takes a small amount of time to travel from your platform to your broker to the liquidity provider and back. During high-volatility periods, prices can move significantly in that time. The result is that your order is filled at a different price than you saw when you placed it.
Slippage can be positive (you get a better price than expected) or negative (you get a worse price). In practice, slippage during fast markets tends to be negative more often than positive.
When slippage is worst
- Major news releases (NFP, CPI, central bank decisions)
- Market open (Sunday evening forex open)
- Low liquidity periods (late Friday, public holidays)
- Gaps between trading sessions
Why it matters for EA traders
Backtests are run on historical data where every order fills exactly at the target price. In live trading, slippage adds a real cost that the backtest doesn't account for. For scalping EAs targeting 3–5 pip profits per trade, a 2-pip slippage on entry and exit can eliminate the entire edge.
This is why backtests — even accurate ones — always outperform live trading to some degree. Slippage, along with spread variation, is the most common reason for the gap between backtest and live performance.
Common misconceptions
- You can't eliminate slippage. You can reduce it — by using brokers with faster execution, avoiding trading during news events, and choosing liquid pairs. But you can't eliminate it entirely.
- ECN brokers don't eliminate slippage either. ECN (Electronic Communication Network) brokers offer better execution than market makers, but slippage still occurs during fast markets.
The Karnek note
Karnek is read-only monitoring for MetaTrader - it watches every account you run, live on one dashboard, and alerts you the moment something stops. It never trades and never asks for a trading password.
Written and reviewed by the Karnek Research team. Last updated August 2026.
Educational content only - not financial advice. Past performance does not predict future results. Trading carries significant risk.