Introduction
When Predictability Has A Price
The market is chaos, but some brokers promise calm.
They offer Fixed Spreads, constant, unchanging costs between Bid and Ask,
even when volatility surges.
📍 For retail, that looks safe.
For Smart Money, it’s a trade-off,
control over cost,
but at the expense of true liquidity.
What Is A Fixed Spread?
The Definition:
📊 A Fixed Spread means the difference between the Bid and Ask remains constant,
regardless of volatility, session, or news events.
Unlike variable spreads that expand or contract with liquidity,
a fixed spread stays the same,
for example, 1.0 pip on EURUSD at all times.
💬 In simple terms:
You always know what you’ll pay,
but not what you might miss.
📍 The illusion of stability hides the absence of transparency.
Why Fixed Spreads Matter
Smart Money cares less about comfort and more about control.
Fixed spreads matter because they:
- Define execution cost consistency.
- Eliminate spread widening during high volatility.
- Limit access to raw interbank liquidity.
- Reflect broker intervention instead of true market depth.
💡 The fixed spread gives predictability,
but predictability always costs precision.
Smart Money View Of Fixed Spreads
Institutions avoid fixed spreads because they distort reality.
1️⃣ No Depth: Fixed pricing hides real liquidity shifts.
2️⃣ Artificial Stability: Spreads remain constant, but fills become slower.
3️⃣ Broker Control: Markups are baked in to guarantee broker margins.
4️⃣ Limited Transparency: You pay the same, even when liquidity is high.
📍 Smart Money trades with what is, not what’s been fixed.
Example
Fixed vs Variable Spread During News
During a high-impact release,
variable spread brokers might expand spreads from 0.8 to 3.5 pips.
Fixed spread brokers stay at 1.5 pips,
but slippage increases,
and orders fill seconds late.
💬 You didn’t avoid volatility,
you delayed exposure to it.
The Do Nots
Common Mistakes Traders Make
❌ Believing fixed spreads remove volatility risk.
❌ Ignoring hidden slippage during high-impact events.
❌ Assuming tighter fixed spreads mean better execution.
❌ Failing to compare fill quality between brokers.
💬 Fixed spreads fix the cost, not the outcome.
Final Thoughts
A Fixed Spread is comfort for the impatient,
but clarity for the aware.
Smart Money understands that markets breathe,
and spreads expand for a reason.
Control isn’t found in fixing the cost,
it’s found in mastering when that cost matters most.