What Is Slippage in Trading?

Slippage is the difference between the price you expected to trade at and the price your order was actually filled at.

Why it happens

• Fast markets around news releases
• Low liquidity, such as outside main sessions
• Market and stop orders, which fill at the next available price

Why it matters

Slippage on stops makes losses larger than planned, and it eats into small scalping profits. A strategy that looks profitable in a backtest can lose money once realistic slippage is included.

Track it

Compare planned entry and stop prices with actual fills in your journal, and measure results net of slippage and commissions.

Related: R-multiple, how to backtest a strategy. See the trading glossary.