Interbank spread versus retail spread: they are not the same thing
Posted: Thu Oct 29, 2026 4:28 am
The tight spread seen on a retail platform is not the same as the interbank spread, even when the number looks similar. The retail quote is built from interbank prices, plus a markup, plus a smoothing process.
Several details matter. Retail feeds may update less often than the interbank market. Spreads shown can be averaged over a short period. The markup may change with account type, volume, or time of day.
For a scalper, the practical effect is that quoted spreads are not always achievable. A displayed spread of 0.4 pips may produce fills that cost closer to 0.8 once slippage and delay are counted.
The honest test is to measure the all-in cost of round trips, not just the spread on screen. Take twenty small trades at a quiet time, compare the entry and exit to the quotes at the click, and add commission. The result is the real number to plug into any expectancy calculation.
Platform spread displays may also show a smoothed or periodically sampled value, so the number on the screen at the moment of the click may not be the one applied to the order. Comparing the displayed spread with the actual difference between the entry price and the opposite quote reveals any discrepancy.
How different is your all-in cost per round trip from the spread displayed on your platform?
Several details matter. Retail feeds may update less often than the interbank market. Spreads shown can be averaged over a short period. The markup may change with account type, volume, or time of day.
For a scalper, the practical effect is that quoted spreads are not always achievable. A displayed spread of 0.4 pips may produce fills that cost closer to 0.8 once slippage and delay are counted.
The honest test is to measure the all-in cost of round trips, not just the spread on screen. Take twenty small trades at a quiet time, compare the entry and exit to the quotes at the click, and add commission. The result is the real number to plug into any expectancy calculation.
Platform spread displays may also show a smoothed or periodically sampled value, so the number on the screen at the moment of the click may not be the one applied to the order. Comparing the displayed spread with the actual difference between the entry price and the opposite quote reveals any discrepancy.
How different is your all-in cost per round trip from the spread displayed on your platform?