Slippage vs requotes: What’s the difference?
Reading time: 9 minutes
Have you ever experienced your trade getting filled at a different price than what you expected? Or have there been times when your broker has returned with a slightly different quote for you to accept before your order gets executed?
These outcomes are known as slippage and requotes. While both are related to forex order execution, they work differently and can affect your trading decisions in different ways. Understanding the difference can help you assess your broker’s execution model, manage your expectations and make more informed trading decisions.
Key Points
- Slippage occurs when an order is executed at a different price from the expected price. It can work in your favour or against you.
- Requotes happen when the requested price is unavailable and the broker offers a new price, which may require your acceptance.
- Neither outcome can be understood in isolation. Market conditions, liquidity, order types and your broker’s execution model all matter.
What is slippage in trading?
Slippage occurs when the price at which your order is executed differs from the price you expected when placing it.
Forex prices can change quickly. By the time your order reaches the execution system, the original quote may no longer be available. Your order may then be filled at the next available price.
For example, suppose EUR/USD is trading at 1.10000, and you place a market buy order. Before the order is filled, the price moves to 1.10010. If your order executes at the new price, you have experienced slippage. In this case, the difference is one pip. For a standard lot of 100,000 euros, that represents approximately $10 in the EUR/USD price movement, assuming the position is valued in US dollars and excluding other trading costs.
Slippage can be more likely when there is high volatility or limited liquidity. However, it isn’t always negative. Positive slippage happens when your order is filled at a better-than-expected price.
What are requotes in forex trading?
A requote occurs when the price you requested is no longer available. Instead of executing the order at that price, the broker offers you a new one. You can then decide whether to go ahead or walk away.
Say EUR/USD is quoted at 1.10000 and you place a buy order. By the time the broker processes it, the price has moved to 1.10015. Rather than fill your order at the new level, the broker sends you a requote. You can accept the revised price or reject it. If you turn it down, the trade won't go ahead at that price.
However, markets don’t wait. The market could move again while you’re deciding whether the new price is worth accepting.
Requotes are often linked to instant execution, where the broker attempts to fill an order at the price you request. If that price is no longer available, you may be offered another one. The process isn’t the same across all brokers, though. It depends on how orders are handled and the terms of your account. Traders usually check those details before they start trading.
Slippage vs requotes: What are the key differences?
The main difference is what happens to your order when the requested price changes.
| Feature | Slippage | Requotes |
|---|---|---|
| What happens? | The order is filled at a different price from the expected price. | A new price is offered because the requested price is unavailable. |
| Does the order execute immediately? | It may execute at the next available price, depending on the execution model. | The trader may need to accept the new quote before proceeding. |
| Can it be favourable? | Yes. Positive slippage can improve the execution price. | The new quote can be more favourable or less favourable. The trader can decide whether to accept it. |
| Common circumstances | Fast-moving markets, low liquidity and changing prices. | Often associated with instant execution when the requested price cannot be honoured. |
| Main concern | The final execution price may differ from expectations. | The opportunity may be missed while the trader responds. |
Let’s say a trader is looking to buy GBP/USD ahead of a major UK economic release. With slippage, the order may be filled at a higher price than expected if GBP/USD rises before execution. The trade goes ahead, but at a less favourable entry. With a requote, the broker may return a new, higher price and ask you to accept it. You can accept it if the revised entry still fits your trading plan.
Neither outcome is automatically worse in every situation. You prefer to accept a new quote rather than enter at an unfavourable price, while another trader might prefer market execution, which prioritises filling the order at the available market price rather than waiting for confirmation of a revised quote. The important point is to understand how the broker handles orders and how that process fits your strategy.
Why do slippage and requotes happen?
Both can arise when prices change between the time an order is submitted and the time the execution system processes it. Several factors influence the outcome.
Market volatility
Prices can move sharply after key economic data releases or other market-moving events. The requested price is no longer available before execution, the order may be filled at a different level or a requote may be issued.
Liquidity
Liquidity refers to how readily an asset can be bought or sold without significantly affecting its price. When fewer buyers or sellers are available at a particular price, an order may need to be filled at another level. This can occur during quieter trading sessions, around market openings or when unexpected events disrupt normal trading activity.
Order size
A large order may not be filled entirely at the requested price level if there is insufficient liquidity at that level. Depending on the broker and execution arrangements, the order may be filled across different price levels or handled in another way.
Broker execution model
The broker’s technology, liquidity arrangements and order-handling rules influence how price changes are managed. For example, a broker using market execution may fill an order at the next available price, which means slippage can occur without a requote. Under an execution arrangement that requires confirmation of a revised price, a requote may occur instead. Execution speed also matters because prices can change while an order is being processed. However, lower execution latency cannot eliminate market movements or liquidity constraints, or guarantee a particular execution price.
How can traders manage slippage and requotes?
Neither slippage nor requotes can be eliminated in every market condition. However, traders can take practical steps to understand and reduce their potential impact.
Check the broker’s execution policy. Find out whether the broker uses market execution, instant execution or another arrangement. Check how it handles unavailable prices, partial fills and orders during volatile conditions. Don’t assume that every account offered by a broker has identical terms.
Understand your order types. Market orders prioritise execution over a specific price. Limit orders set a price condition, although execution is not guaranteed if the market doesn’t reach the required level or sufficient liquidity is unavailable. Stop orders can also be affected by price gaps and fast-moving markets.
Be cautious around major announcements. If your strategy doesn’t require trading economic releases, consider whether entering immediately before an announcement is worth the additional execution risk. Wider spreads and sudden price movements can affect the overall trade.
Review your trading records. Compare expected and actual execution prices, noting when slippage occurs and whether it is positive or negative. If requotes are frequent, investigate whether they are linked to a particular instrument, session, order type or broker policy.
Consider the full cost of a trade. Spreads and commissions are not the only factors that matter. Slippage can affect the price you receive, while repeated requotes may delay entry or prevent you from entering at the intended time or price. These factors should be considered alongside other forex trading costs when assessing a broker.
Finally, test your approach in a demo environment where possible. A demo account can help you become familiar with order types and platform functions. Traders using Contracts for Difference (CFDs) also typically keep an eye on slippage vs requotes, since leverage can multiply the impact of a price difference on the trading outcome.
Make execution part of your trading plan
Slippage and requotes may seem like technical details, but they can influence entry prices, trading costs and the timing of a position. Slippage changes the price at which an order is filled, while a requote offers a revised price that may require the trader’s approval. The right broker isn’t simply the one promising the lowest spread or fastest execution. It is one whose execution arrangements, costs and trading conditions you understand and can assess against your own requirements.
FP Markets offers ECN pricing, streaming price feeds directly from liquidity providers. This can lower the risk of slippage and requotes. Open your account to explore the world of CFD trading with advanced platforms and an experienced customer support team that can help you navigate global markets.
Frequently asked questions (FAQs)
Yes. If your order is filled at a better price than expected, which is positive slippage. For example, a buy order might be executed slightly below the price you saw when placing it. However, if the final price is less favourable, the result is negative slippage.
A requote can happen when the price you requested is no longer available under the broker's execution model. The broker offers a new price instead, and you may need to accept it before the trade can proceed.
It depends on the situation. Slippage means your order is filled at a different price, while a requote gives you the chance to accept or reject a revised price. With slippage, the trade may go ahead without another decision from you; with a requote, you may miss the opportunity while deciding what to do.
