Raw Spread
Trading Costs
A raw spread is the near-interbank spread passed on to a trader with little to no broker markup, typically paired with a separate per-lot commission rather than being built into the price.
What is a raw spread?
A raw spread is a spread that reflects prices very close to the true interbank or liquidity-provider rate, with little to no markup added by the broker. It’s the pricing model typically offered on ECN and “raw” or “zero” account types, where the broker earns its revenue through a separate, explicit commission instead of widening the spread itself.
Because raw spreads can compress to a fraction of a pip during liquid market conditions, they’re often marketed with headlines like “spreads from 0.0 pips” — though the typical (average) spread, not just the occasional best-case low, is what actually matters for cost comparison.
A worked example
Consider two account types at the same hypothetical broker, both trading one standard lot of EUR/USD:
| Account type | Typical spread | Commission | Approx. total cost |
|---|---|---|---|
| Standard (spread-only) | 1.2 pips (~$12) | None | ~$12 |
| Raw spread + commission | 0.1 pip (~$1) | $6 round-turn | ~$7 |
In this illustrative comparison, the raw-spread account works out cheaper overall despite charging a separate fee, because the spread itself is so much tighter. This is why raw-spread accounts are popular with active traders and scalpers, whose profits per trade can be small enough that even a 1-pip difference in spread meaningfully affects results. The exact numbers differ by broker, pair, and market conditions, so this comparison should always be re-checked with each broker’s real, published figures.
Why raw spreads matter
For cost-sensitive strategies — scalping, high-frequency manual trading, or running an Expert Advisor that trades often — the combination of a tight raw spread plus a transparent commission is frequently the cheaper option, even though it looks like “two costs” rather than one. It also makes true trading costs more visible, since the commission is a clearly stated number rather than hidden inside a wider spread.
The trade-off is added complexity when comparing brokers: a raw-spread account’s total cost can only be judged by adding spread and commission together, never by looking at either figure alone.
Quick recap
- A raw spread is close to the true market price, with the broker’s fee charged separately as commission.
- Common on ECN and “raw”/“zero” account types.
- Always compare total cost (spread + commission), not spread alone, against standard accounts.
- Best suited to active, high-frequency, or algorithmic trading styles where tight spreads matter most.