What is Spread in Forex
The forex spread is the cost you pay to enter a trade. For example, if EUR/USD has a bid price of 1.1000 and an ask price of 1.1003, the spread is 3 pips. For Thailand traders, this cost is converted to THB based on your trade size. A standard lot (100,000 units) with a 3-pip spread costs approximately 30 USD or about 1,050 THB (at 35 THB/USD). That’s a real cost every time you open a position. Spreads vary by currency pair, broker, and market conditions. Major pairs like EUR/USD have tight spreads (0.1–0.5 pips) due to high liquidity, while exotic pairs like USD/THB may have spreads of 5–10 pips. Thailand traders should focus on major pairs to minimize costs. Brokers earn money through spreads or commissions. Fixed spreads remain constant regardless of market volatility, while variable spreads fluctuate with liquidity. For experienced traders in Thailand, variable spreads can be cheaper during high-volume sessions (e.g., London or New York opens) but widen during news releases. SEC Thailand requires brokers to disclose spread types clearly. When using PromptPay for deposits, ensure your broker offers competitive spreads—some brokers offer tighter spreads for higher deposit amounts. Bank Transfer and Skrill may add processing fees, but PromptPay is usually free, saving you money that can offset spread costs.