WHAT IS A SPREAD?
The spread is difference between ASK and BID price. It represents the fee we charge you for trading with us. Spread is traditionally denoted in pips (a percentage in point), meaning fourth decimal place in currency quotation. You can work out the spread on our trading platform by looking at the sell and buy price and the difference between the two prices is the spread.
In this example of the New Zealand Dollar against the United States Dollar, the sell price is 0.69138 and the buy price is 0.69154 The difference between the price is or the spread is 0.00016 which is 1.6 pips spread.
When trading you will either buy or sell a specific product when you place a trade. A profit will be made once the price has moved position in your favour and covered the cost of the spread after a trade has been placed. The other situation, for example, is when the price has moved in your favour but hasn’t covered the spread, or the price went against you, and a losing trade has occurred. The major part of the costs involved in CFD trading is the spread cost.
A smaller spread indicates a better value for a you. In the addition to the spread some brokers also charge a commission, GPP Markets does not charge commission on most of its products.
When trading you will either buy or sell a specific product when you place a trade. A profit will be made once the price has moved position in your favour and covered the cost of the spread after a trade has been placed. The other situation, for example, is when the price has moved in your favour but hasn’t covered the spread, or the price went against you, and a losing trade has occurred. The major part of the costs involved in CFD trading is the spread cost.
A smaller spread indicates a better value for a you. In the addition to the spread some brokers also charge a commission, GPP Markets does not charge commission on most of its products.
Trading CFDs may not be suitable for everyone as they are high risk financial product. Please ensure that you understand the risks involved. A Product Disclosure Statement can be obtained here and should be considered before trading with us.
GPP Markets is also a member of an independent dispute resolution scheme the Financial Services Complaints Limited (“FSCL”) our membership number is 6397. This is approved dispute resolution scheme under the Financial Service Providers (Registration and Dispute Resolution) Act 2008.
GPP Markets Ltd is a company registered in New Zealand (NZBN 9429042010807) located at Level 21 191 Queen Street, Auckland; PO Box 5382, Wellesley Street, Auckland.Phone: +64 9 281 2012 email: info@gppmarkets.com. GPP Markets Ltd is a registered Financial Service Provider (FSP509766) and holds a Derivative Issuer Licence issued by the Financial Markets Authority.
GPP Markets is also a member of an independent dispute resolution scheme the Financial Services Complaints Limited (“FSCL”) our membership number is 6397. This is approved dispute resolution scheme under the Financial Service Providers (Registration and Dispute Resolution) Act 2008.
GPP Markets Ltd is a company registered in New Zealand (NZBN 9429042010807) located at Level 21 191 Queen Street, Auckland; PO Box 5382, Wellesley Street, Auckland.Phone: +64 9 281 2012 email: info@gppmarkets.com. GPP Markets Ltd is a registered Financial Service Provider (FSP509766) and holds a Derivative Issuer Licence issued by the Financial Markets Authority.