Definition and example
Slippage compares a declared reference price with the actual fill price. Synthetic example: you expected to buy at 100 and the fill was 100.25; the difference is 0.25 price units, unfavourable for that purchase.
Always define the reference and when you observed it. A fill can also be better than the reference. Slippage is not necessarily a separate fee: it may be incorporated in the price. A model without slippage does not demonstrate that real orders would receive identical fills.
Sources and references
Chezur examples and explanations are educational. Consult the original source to verify conditions, data and updates.
Context and review of this explanation
What is slippage between an expected and an executed price?
- Topics
- Orders and execution · Units and costs
- Level
- Beginner
- Skills
- Explain an order instruction · Calculate with units and costs
- Examples
- Hypothetical situations illustrating the concept.
- Specialist review
- Not documented for this edition. Automated structure and internal-link checks do not establish specialist review.