Quote:
Originally Posted by kawola17
Hello David,
Thank you for all your videos!
I know the amount of slippage depends on many factors. But what do you think or what is a recommended amount of slippage? ( I saw that you put it at 2 in your video. And is the 2; 2 pips??)
Thanks in advance.
Sincerely,
Bill
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Hey Bill,
Yes the number in the box represents the number of pips of slippage that you are willing to accept.
In general, because the FX market is so liquid (meaning there are huge amounts of currency traded every day), you will receive very little if any slippage regardless of what the box is set to. Two exceptions to this would be if you are trading around a news event, or if you are trading a large sized position (+5 Million) in off hours in some of the less liquid pairs like NZD/USD.
With this being said I think the amount of slippage that traders are normally willing to accept depends primarily on their profit target. If for example a trader is scalping the market for 10 pips a trade, then 1 pip slippage is 10% of their profits so they may not be willing to accept any slippage. If however a trader is targeting 500 pips then a few pips slippage probably does not make much of a difference to them.
Let me know if there are any other questions.
Best Regards,
Dave