The Complete Guide to forex com spreads

Opening — Who this is for and what it solves

This guide is for active forex traders and investors who use Forex.com or are deciding between account types. You will learn what forex com spreads are and how they translate into actual trading costs. Check concrete examples with numbers: 0.0 pips, 1.2 pips, $7 commission per $100,000, and the $10 value of 1 pip on a 100k lot. Compare RAW Pricing versus Spread‑Only side‑by‑side. See tactical steps that can cut spread costs by tens of dollars per 100k trade. Use this to decide which Forex.com account suits your strategy, when to trade specific pairs, and how to avoid spread mistakes that erode returns.

Quick Answer / TL;DR — Key takeaways up front

• If you trade small intraday positions, use Spread‑Only when EUR/USD spreads are about 1.2–3.0 pips to avoid commission.
• If you trade large sizes or scalp, use RAW Pricing: EUR/USD from 0.0 pips + $7 commission per $100,000 traded.
• Watch trading hours: spreads narrow during major session overlap (08:00–12:00 GMT) and can widen from 0.1 pips to 10–50 pips around news or low liquidity.
• Use limit orders, avoid open/close windows, and always calculate cost per 100k (1 pip on EUR/USD ≈ $10) before you enter a trade.

What We Looked For — Evaluation criteria for account/pricing choices

• Spread tightness (pips): measure direct entry/exit cost. Track medians and tails. Example targets: 0.0–0.5 pips vs 1.2–3.0 pips.
• Commission vs spread tradeoff ($ per 100k): compare $7 per 100k commission to pip costs (1 pip = $10 per 100k).
• Execution speed and slippage (ms / pips): check fills under 100 ms and slippage under 0.5 pips for scalps. Note occasional slippage spikes of 1–5 pips at news.
• Liquidity and pair coverage (pairs / depth): confirm access to 80+ pairs and deep liquidity on majors; expect thin depth on exotic pairs under $1k notional.
• Pricing transparency and volatility behavior: test spread behavior at market open, 08:00–12:00 GMT overlap, and around scheduled news where spreads can jump 5–50 pips.

Definition and Key Numbers — Core spread concepts and metrics

Define spread. Spread = Ask − Bid (Ask price minus Bid price). Example formula: Spread (pips) = Ask − Bid. Example numeric calc: Ask 1.15502 − Bid 1.15500 = 0.00002 → 0.2 pips (1 pip = 0.0001 for most majors). Explain pip and pipette. A pip is the fourth decimal for EUR/USD and most pairs (0.0001). A pipette is a tenth of a pip (0.00001). For USD/JPY, 1 pip = 0.01 (two decimal places). Show value examples: 1 pip on a 100,000‑unit (standard) lot in EUR/USD ≈ $10. 0.1 pip (1 pipette) on 100k ≈ $1. On a 10,000 lot, 1 pip ≈ $1; on a 1,000 lot, 1 pip ≈ $0.10. Distinguish raw spread vs spread‑only pricing. Raw can show 0.0 pips on EUR/USD but adds a commission of $7 per $100k (per side or per round? see broker convention). Spread‑Only shows wider pips (example typical 1.2–3.0 pips) with no commission. Convert pips to percent for scale. Example: a 0.3 pip spread on EUR/USD at 1.1550 equals 0.00003 / 1.1550 ≈ 0.0026% notional cost. Use these numbers to compare cost across account types and sizes.

How Spreads Are Calculated and Quoted — Formulas and practical examples

Show the math. Use clear examples. Example quote: Ask 1.15609 − Bid 1.15579 = 0.00030 → 3.0 pips. Convert that to dollars for 100k: 3.0 pips × $10 per pip = $30 cost one side? Clarify broker convention. Brokers typically charge spread on entry (immediate cost) and again effectively on exit. Compare RAW Pricing arithmetic. RAW: 0.0 pips + $7 commission per $100k. Cost per side = $7; round‑trip cost = $14 for 1 standard lot (100k). Spread‑Only arithmetic. Spread‑Only: 1.2 pips typical on EUR/USD → 1.2 × $10 = $12 round‑trip per 100k if you count paid spread on entry and effectively on exit (many compare round‑trip as twice the pip cost). Direct TTL comparison math example:
– For 100k: RAW = $14 total. Spread‑Only = $12 total at 1.2 pips (if broker counts 1.2 pips once, then round‑trip effective cost can be close to $12).
– Breakeven point: commission of $7 per side equals 0.7 pips per side (because $7 / $10 per pip = 0.7 pips). So if Spread‑Only spread > 1.4 pips round‑trip equivalent, RAW is cheaper.
Include hidden costs and variability:
– Slippage: expect 0–10+ pips during news. Typical slippage 0–1 pip on liquid pairs.
– Requotes/partial fills: can cost 0.1–2.0 pips in practice.
– Swap/overnight financing: can add roughly ±0.5–2.0% on the notional over a 30‑day hold, depending on pair and direction.
Always compute cost per 100k and per pip, and simulate both models for your typical trade size and holding time.

Forex.com Account Types and Pricing Models — Concrete numbers and when to pick each

Describe RAW Pricing. RAW Pricing: EUR/USD from 0.0 pips + $7 commission per $100k. Typical fills: EUR/USD 0.0–0.3 pips during London–New York overlap. Example spreads for other pairs on RAW: USD/JPY 0.1 pips, GBP/USD 0.2 pips, AUD/USD 0.3 pips, EUR/GBP 0.2 pips (indicative). Describe Spread‑Only. Spread‑Only: advertised tight spreads with no commission. Example quotes: EUR/USD 1.2–3.0 pips typical (site shows instances of 3.0 pips), USD/JPY 0.0–0.4 pips, GBP/USD 0.2–5.0 pips, AUD/USD 0.3–4.0 pips. Practical tradeoffs with numbers:
– If you trade 10k per trade, 1 pip = $1. Commission $7 per 100k equals $0.70 per 10k (0.7 pip equivalent).
– If you trade 100k, 1 pip = $10. Commission $7 per side is 0.7 pip.
– Use RAW Pricing if you trade ≥50k per trade or scalp for profits ≤2 pips. Example: target 2 pip scalp on 100k → 2 pips = $20 gross. RAW adds $14 total, leaving $6 net before slippage. Spread‑Only at 1.2 pips would cost $12, leaving $8 net. For targets under 1.4 pips, RAW usually wins.
– Use Spread‑Only if you trade ≤10k per trade and want no commission. Example: 10k trade, 1 pip = $1; a 1.2 pip spread costs $1.20 versus a commission equivalent of $0.70 for a 10k share of the $7 per 100k, making spread‑only slightly more or less attractive depending on spread.

Comparison table (mandatory)

Best for: RAW Pricing — scalpers and traders handling 50k–1,000k per trade who need sub‑pip spreads and accept $7 per 100k.
Skip if: RAW Pricing — you trade micro lots ≤10k frequently and want zero commission.

Watch out for: spreads can spike at market open and around 17:00 ET (broker settlement window). Expect temporary widening to 1–50 pips depending on pair and event.

Typical Spread Ranges by Pair and Time — Numbers for majors, minors, and session effects

Give headline ranges. Majors in normal liquidity:
– EUR/USD: 0.0–3.0 pips (typical 0.0–1.2 on RAW vs 1.2–3.0 on Spread‑Only).
– USD/JPY: 0.0–0.4 pips.
– GBP/USD: 0.2–5.0 pips.
– AUD/USD: 0.3–4.0 pips.
– EUR/GBP: 0.2–5.0 pips.
Session timing effects:
– London–New York overlap (roughly 08:00–12:00 GMT): spreads narrow. Expect 0.0–0.5 pips on EUR/USD and USD/JPY. Example improvement: EUR/USD median drop from 1.0 pip to 0.2 pip.
– Asian session and low liquidity windows: spreads widen. Expect 1.0–10.0 pips on some pairs and 5–50 pips on thin exotics.
Quantify news impact with numbers:
– During major economic releases, expect spreads to widen by 5–50+ pips on illiquid pairs and by 1–10 pips on majors. Example: EUR/USD may go from 0.3 pips pre‑news to 10+ pips at peak.
Monitoring and entry checks:
– Check live quote for 30–60 seconds before entry.
– If spread > median by 50% (e.g., median 0.6 pips, current 1.0+ pips), delay or use a limit order.
– Watch trading hours: broker settlement and market open often cause spreads to double or triple for 5–60 minutes.
Use these numbers to schedule trades and reduce soft costs.

Strategies to Minimize Spread Costs — 5 tactical steps with concrete numbers

1) Trade the most liquid times.
– Target EUR/USD during London–New York overlap. Expect spreads 0.0–0.5 pips. Avoid Asian thin windows when spreads can be 1.0–5.0 pips.
– Save $5–$40 per 100k trade by shifting to the overlap versus low liquidity.
2) Use RAW Pricing for larger sizes.
– If your normal trade is ≥50k, favor RAW. Example: 100k trade at RAW costs $14 round‑trip plus 0.1–0.3 pip; Spread‑Only at 1.2 pips costs about $12. For targets under 2 pips, RAW usually wins.
– Calculate breakeven: $7 per side equals 0.7 pips per side on 100k.
3) Use limit orders and passive fills.
– Submit a limit order instead of a market order to avoid paying a widened spread. Save 0.2–2.0 pips per trade when spreads are volatile.
– If you routinely pay 1.5 pips in spread and can get filled at 0.5 pips with a limit, save $10 per 100k.
4) Avoid open/close and headline windows.
– Skip trades within 15 minutes of major releases or within 30–60 minutes of market open/close. Spreads can jump from 0.3 pips to 10–50 pips.
– If a 100k trade would experience 5 pips slippage, that equals $50 extra cost.
5) Size and ladder your orders.
– Break a 500k order into five 100k slices to avoid depth‑related spread degradation. Expect to save 0.2–0.8 pips per slice, or $20–$80 across the full 500k.
– Use RAW Pricing for the large aggregated volume if you trade >250k regularly.
Watch out for: commission drag on micro accounts. If you trade 1k or 10k frequently, the $7 per 100k commission prorated can be a larger relative fee. For 10k, $7/10 = $0.70 equivalent (0.7 pip), which matters when your typical edge is ≤1 pip.

Closing — Final checklist and next steps

Make a simple decision checklist. Compare the following numbers for your setup:
– Average trade size in units (1k, 10k, 100k, 500k).
– Typical target in pips (0.5, 1, 2, 10).
– Acceptable round‑trip cost in dollars (e.g., <$10, <$50).
– Preferred execution window (08:00–12:00 GMT overlap or other).
Run the math:
– 1 pip on 100k = $10; on 10k = $1; on 1k = $0.10.
– Commission $7 per 100k = $0.70 per 10k = $0.07 per 1k.
– Breakeven spread per side for $7 commission on 100k = 0.7 pips.
Decide:
– If your normal trade is ≥50k and you scalp targets under 2 pips, pick RAW Pricing.
– If you trade ≤10k and want no commission, pick Spread‑Only.
Next steps:
– Test both models with a demo account using 5–20 test trades and measure average spread, slippage, and fill time in ms.
– Track 30 days of live fills and compute average round‑trip cost per 100k. Use that number to scale up or switch account type.
Final reminder: check live forex com spreads before entry. Compare the spread in pips, convert to dollars for your lot size, add commissions, and then trade. Calculate cost per 100k each time and avoid surprises.