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To come to the definition of the spread, let’s start with bid and ask prices.
You can meet these terms when exchanging money in the bank. Have you noticed that one price is higher and the second is lower? The lower price is at which the bank buys the currency from you, and the higher one is at which it sells the currency to you. The difference between these two prices is called spread. Spread is revenue that a bank gets from the foreign exchange operations it performs for a client.
FX spread works similarly. To enter the forex market, you need a broker who will carry out your operations. The commission you will pay a broker is called spread.
There are two prices on the chart: bid (lower) and ask (higher). You can read more about them in our article. The difference between them is called spread. To calculate the spread faster, check the FBS calculator.
The fixed spread is a convenient option for traders because they always know how much they will pay.
The floating spread is the spread that changes depending on the market conditions and supply-demand issues.
No-spread, zero spread, or 0 pip spread is an option to trade without the spread. Instead, you will pay a commission for opening positions.