Variable spreads in forex are those that fluctuate in size rather than staying at a fixed rate. The reason for this is that real brokers process orders directly in the market. There are advantages and disadvantages to this type of broker. Trading this way is more reliable than using a standard broker for some traders. Traders who want to minimize their trading costs should consider the variable spread option. Spreads can make trading more unpredictable, but they can also reduce losses.

Variable spreads can widen during periods of intense volatility, which is their main disadvantage. High execution costs can result from this. A fixed spread allows traders to calculate their costs before entering a trade. Traders who prefer variable spreads usually have deeper pockets. These traders usually have higher capital than those who use fixed spreads. However, these traders must be aware of the risks associated with them. Therefore, it is important to understand how variable spreads work and how they can impact your trading.