Slippage
Slippage is the difference between the expected price of a trade and the actual fill price. It occurs when markets are moving fast, liquidity is low, or order size is large relative to available supply. Slippage adds to trading costs.
Why it matters for traders
Slippage affects all traders but is most significant for high-frequency traders, scalpers, and traders in illiquid markets. Backtesting results often overestimate real-world performance because they don't account for slippage.
How Tradapt tracks this
Note your actual fill prices vs planned entry prices in Tradapt's trade notes to track slippage over time and incorporate it into your strategy evaluation.
Track this free in TradaptFrequently asked questions
How do you minimise slippage in trading?
Use limit orders instead of market orders when possible, trade highly liquid instruments during peak liquidity hours, and avoid very large position sizes in illiquid markets.