What is a spread?

In CFD trading, the spread is the difference between the buy price and the sell price quoted. The price at which you buy is always higher than the price at which you sell, and the underlying market price will generally be in the middle of these two prices. ​​

When you place a trade, you will either buy or sell the particular market you're trading on, depending on whether you believe the underlying market price will rise or fall.

The spread is one of the key costs involved in CFD trading – the tighter the spread, the better value you're getting as a trader. We offer consistently competitive spreads, with our spreads starting from just 0.7 points for EUR/USD and USD/JPY, and from 1 point for the UK 100 and Germany 30 indices. Tight spreads mean that you can make a profit or loss from even small movements in price. See our range of markets page for more information about our spreads. ​

​​Once you have placed your trade and either selected buy or sell on a particular product (eg US 30), you will be looking for that market to move further than the price of the spread. If that outcome is achieved when you close your trade, you'll make a profit by buying your sell trade, or conversely, selling your buy trade.

​​Note that there are other potential costs to consider, for example some markets involve a commission charge, or a combination of spread and commission.

The spread is the last large number within a price quote.​

Example 1

The spread on the UK 100 shown here is 1.0, calculated by subtracting 6446.7 (sell price) from 6447.7 (buy price).

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Example 2

The spread on the GBP/USD shown here is 0.9. If you subtract 1.65364 from 1.65373, that equals 0.00009, but as the spread is based on the last large number in the price quote, it equates to a spread of 0.9.

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Spread betting and CFD trading can result in losses that exceed your deposits. Ensure you understand the risks.