Glossary entry
Slippage is the difference between an expected or referenced execution price and the price actually obtained. It may be favorable or unfavorable and can arise as quotes move, available quantity is consumed, or an order travels to the market. It is distinct from a stated commission, although both affect the overall cost of a trade.
Illustrative example
An investor expects to buy at 10.00 but fills at 10.04 after available offers change. The unfavorable difference is 0.04 per unit before other costs.
What to consider
Fast markets and thin liquidity can increase slippage. Limit orders constrain price but can leave some or all of the order unfilled.
General information, not a personal recommendation. Product availability, rights, and obligations are determined by the relevant provider, jurisdiction, and approved agreements.