Is a lower spread always cheaper?

No. A raw account with a 0.0 pip spread also charges commission, so compare the all-in cost per lot rather than the headline spread.

What is a good EUR/USD spread?

Raw accounts typically show 0.0-0.2 pips plus commission; commission-free accounts usually sit between 0.5 and 1.0 pips.

How Forex Spreads Work (And What You Actually Pay)

A plain-English guide to how forex spreads work: bid/ask, pips, spread cost per lot, raw vs standard accounts, and why EUR/USD, GBP/USD and XAU/USD spreads differ.

Every forex quote has two prices: the bid (what you can sell at) and the ask (what you can buy at). The gap between them is the spread, and it is the main cost of a trade.

Spreads in pips

For most pairs a pip is 0.0001. If EUR/USD is quoted 1.08421 / 1.08431, the spread is 1.0 pip. On GBP/USD the same maths applies; on XAU/USD (gold) a pip is usually $0.01, so a 0.10 spread means 10 cents per ounce.

What a spread actually costs you

On a standard lot (100,000 units), one pip on EUR/USD is roughly $10. So:

1.0 pip spread = about $10 per standard lot, round trip
0.3 pip spread = about $3 per standard lot
0.0 pip raw spread + $3 per side commission = about $6 per standard lot

That is why comparing headline spreads alone is misleading — a raw account with 0.0 pip spreads and commission can be cheaper or dearer than a 0.9 pip commission-free account depending on how much you trade.

Raw/ECN vs standard accounts

Raw or ECN accounts pass through the interbank spread and charge a separate commission. Standard accounts bundle a markup into the spread and charge no commission. Scalpers and high-frequency traders usually prefer raw pricing; occasional traders often find standard simpler. See ECN vs market maker explained for how the execution model differs.

Why spreads widen

Spreads are not fixed. They widen around news releases, at the daily rollover, and in thin liquidity (late Friday, holidays). A broker advertising "from 0.0 pips" is quoting a best case, not an average.

Compare real numbers

Side-by-side EUR/USD, GBP/USD and XAU/USD figures are on our comparison pages:

Risk disclosure

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. This page is general information, not financial advice. Broker links may be affiliate links.