Why advertised spreads are not what you actually pay
If you visit the website of almost any major forex broker, you will see a spread for EUR/USD quoted somewhere between 0.0 and 0.6 pips. These figures are real — but they represent the tightest spreads the broker achieves during optimal conditions, typically the overlap of the London and New York trading sessions between 13:00 and 17:00 UTC.
During this window, the forex market is at its most liquid. The highest number of professional participants, institutional desks, and electronic market makers are all active simultaneously. Spreads compress as a result of this competition.
Outside those hours — during the Asian session, in the gap between the close of New York and the open of Tokyo, or at the 5 p.m. New York "rollover" — liquidity thins. The bid-ask spread widens as fewer market makers compete to fill orders. On some broker account types, the widening can be dramatic.
The practical consequence: A broker advertising "0.0 pip EUR/USD spread" may offer 0.0 pip during London peak — and 1.5 pip at 3 a.m. UTC during a low-liquidity Asian session. If you trade during off-peak hours, the spread you actually pay bears no resemblance to the advertised figure.
The four spread windows every EU trader should know
Forex spreads follow predictable patterns around the global session schedule. Understanding these windows lets you predict when your broker's spread will be narrow — and when it will be wide.
| Session window | UTC time | Liquidity | Typical EUR/USD spread (ECN) | Notes |
|---|---|---|---|---|
| London open | 07:00–08:00 | High | 0.2–0.5 pip | Opening volatility before liquidity stabilises |
| London + NY overlap | 13:00–17:00 | Peak | 0.0–0.1 pip | Tightest spreads — this is what broker ads show |
| NY close → Tokyo open | 21:00–23:00 | Thin | 0.8–2.0 pip | Rollover window — avoid market orders here |
| Asian session | 00:00–07:00 | Moderate | 0.3–1.5 pip | Varies greatly by broker; JPY pairs tighter here |
| Weekend gap open | Sunday 21:00 | Very thin | 1.0–4.0 pip | First minutes after market reopens — extreme widening possible |
| Economic news releases | Variable | Volatile | 1.0–10.0 pip | NFP, CPI, ECB/Fed decisions — spreads spike briefly |
The 5 p.m. New York rollover
The daily rollover occurs at 5 p.m. New York time (22:00 UTC in summer, 23:00 in winter). This is the moment when positions held overnight incur a swap (interest charge or credit). It is also when many brokers temporarily widen spreads significantly — sometimes to 2–4 pips on EUR/USD — because the interbank market passes through a brief liquidity gap as the 24-hour trading day officially resets.
Traders who hold positions through rollover pay both the swap rate and the wider spread if they close or open around this time. If your strategy involves trading around the end of the New York session, testing your broker's spreads at this specific moment is especially important.
What broker spreads actually look like after hours
Based on spread monitoring data compiled across EU-regulated ECN brokers, here is what typical after-hours spreads look like for EUR/USD on Raw/Razor-type ECN accounts (with commission):
| Broker type | London peak (13:00–17:00 UTC) | Asian session (02:00 UTC) | Rollover (22:00 UTC) | Weekend open |
|---|---|---|---|---|
| Top ECN (e.g. IC Markets Raw) | 0.0–0.1 pip | 0.2–0.5 pip | 0.5–1.2 pip | 1.0–2.5 pip |
| Competitive ECN (e.g. Pepperstone Razor) | 0.0–0.1 pip | 0.3–0.7 pip | 0.6–1.5 pip | 1.2–3.0 pip |
| Standard STP account (same brokers) | 0.6–1.0 pip | 1.2–2.5 pip | 1.5–3.5 pip | 2.5–5.0 pip |
| Market maker / dealing desk | 0.8–2.0 pip | 2.0–5.0 pip | 3.0–8.0 pip | 4.0–12.0 pip |
The data shows two important patterns: first, even among the best ECN brokers, spreads widen significantly during the Asian session and rollover window — sometimes by 5–15x compared to peak hours. Second, the gap between broker types is largest during low-liquidity periods: during London peak, a market maker may charge 1.0 pip versus 0.0 pip for an ECN broker — a meaningful but limited gap. During the overnight Asian session, that same comparison can be 4.0 pip versus 0.3 pip — a 13x difference.
What this means for your trading costs: If you trade exclusively during London and New York session overlap, the broker you choose has a modest spread impact. If you trade during Asian session or near rollover, broker selection becomes critical — the wrong account type can add £10–£50 in spread cost per standard lot per trade compared to a well-chosen ECN account.
How to test spreads yourself in 15 minutes
The most reliable spread data you can get is from a live or demo account, tested at the actual times that match your trading schedule. Here is a simple process for doing this before committing real capital to any broker.
Open a demo account at the broker you want to test
All major EU-regulated brokers offer free demo accounts. Open the account type that matches what you plan to trade — Raw/Razor if you will use an ECN account, Standard if you will not. Demo spreads typically mirror live account spreads accurately on ECN accounts.
Record the spread at four time points
Log into the platform at these four moments and record the bid-ask spread on EUR/USD: (1) 14:00 UTC on a weekday — London-NY overlap peak; (2) 02:00 UTC on a weekday — mid-Asian session; (3) 22:00 UTC on a weekday — rollover window; (4) 21:10 UTC on a Sunday — market reopen gap.
Compare to the broker's advertised spread
The spread shown at 14:00 UTC should match or be very close to the advertised figure. If it is significantly higher, the advertised data may be based on cherry-picked historical periods rather than live conditions. If it matches at peak but widens dramatically at other times, assess whether your personal trading times overlap with those windows.
Calculate the real per-trade cost at your typical trading time
Multiply the spread you observed (in pips) by the pip value for your position size. For a standard lot (100,000 units) EUR/USD, 1 pip = approximately €10. A 1.5 pip spread at Asian session therefore costs €15 per trade in spread alone — before commission. Compare this to the 0.0 pip + $7 commission you would pay at peak hours on an ECN account.
Repeat the test at two or three brokers before you commit
Demo accounts are free and fast to open. Test the same four time windows at two or three brokers you are considering. The difference in after-hours spread behaviour between brokers often reveals a clear best choice for traders with non-peak-session schedules.
What to look for in a spread test
When you have collected your spread data, evaluate each broker against these five criteria:
Peak spread accuracy: Does the observed peak-hour spread match the advertised figure? A broker whose live demo spread at 14:00 UTC is 0.3 pip but who advertises 0.0 pip should be questioned — the discrepancy may reflect their measurement methodology.
Asian session widening ratio: Divide the Asian session spread by the peak spread. A ratio below 5x is good for an ECN account. Above 10x suggests the broker's after-hours liquidity is poor.
Rollover spike duration: Check the spread in 5-minute intervals around 22:00 UTC. Quality ECN brokers see a brief spike that resolves within 5–10 minutes. Weaker brokers can remain wide for 30–60 minutes around rollover.
Weekend gap behaviour: The Sunday open gap should narrow to near-normal within 30 minutes. Significant widening lasting more than an hour after open suggests limited market access or thin liquidity provision.
Stability, not just tightness: A spread that averages 0.2 pip but regularly spikes to 3.0 pip during news events may be less useful to certain strategies than a spread that averages 0.4 pip but remains stable. Know which matters more for your approach.
Which traders does spread time-of-day matter most for?
Asian session traders: Traders who are based in Asia or who prefer trading during the Tokyo/Sydney session will find broker selection far more impactful than their London-session counterparts. EUR/USD after-hours spread differentials between broker types can make the difference between a profitable edge and a losing one at sufficient trade frequency.
Overnight position holders: If you hold positions overnight and close them the next morning, you are exposed to the overnight spread even if you do not actively trade during those hours. Position sizing and stop-loss placement should account for the potential spread widening around rollover.
Scalpers: High-frequency scalpers trading at any time of day should test intraday spread behaviour — not just the daily average. Some brokers maintain tight spreads consistently; others have brief spikes around economic data releases or at specific times that can damage scalping edge.
News traders: Traders who intentionally trade around major economic releases (NFP, CPI, ECB/Fed announcements) should specifically test spreads in the minute before and after those releases. Some brokers widen to 5–10 pip during NFP. Others hold closer to 1–2 pip. This is rarely disclosed in standard marketing materials.
Weekend gap traders: If your strategy involves holding positions over the weekend or trading immediately at Sunday market open, the first-price spread and initial liquidity conditions are critical. Test this once before committing capital to a weekend strategy.
Compare EU-regulated ECN brokers
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Compare all brokers →Frequently asked questions
For ECN account types at regulated brokers, demo spreads are typically fed from the same live liquidity pool, so they closely reflect live conditions. For market maker accounts, demo spreads may be artificially tighter than live conditions. If you want the most accurate comparison, open a small live account and observe spreads there — but demo is a reliable starting point for ECN account comparison.
There is no EU regulation that requires brokers to display average or off-peak spreads. Showing the tightest achievable spread is standard industry practice, not necessarily deceptive — but it is incomplete. ESMA's product governance rules require brokers to disclose material costs clearly, but the specific time-period basis for quoted spreads is not standardised.
Major USD pairs (EUR/USD, GBP/USD, USD/JPY, USD/CHF) are the most liquid globally and maintain relatively tighter spreads after hours compared to minor or exotic pairs. Among them, USD/JPY tends to have better liquidity during the Asian session as it is the most actively traded pair in that region. EUR/GBP and EUR/CHF can widen significantly during non-European hours.
Yes — significantly. ECN accounts pass through raw interbank spreads, so widening during low-liquidity periods reflects actual market conditions. Standard/STP accounts have a markup applied on top of the raw spread, which means the base widening is the same as ECN, but the absolute spread is always higher by the markup amount. This magnifies the cost impact of after-hours trading on Standard accounts.
Not necessarily. Asian session can offer advantages for certain strategies — lower volatility, more predictable range behaviour on some pairs, and reduced news event risk. The question is whether the spread cost at your chosen broker during Asian session hours is compatible with your trading edge. If your system generates 5-pip target moves and you pay 1.5 pip in spread, that may still be profitable. If your target is 3 pips and spread is 1.5, the math is much tighter. Test your actual conditions rather than avoiding sessions categorically.