Why the price you click is not always the price you get: spread and slippage explained

A common surprise for new traders is that the price shown on screen is not exactly the price they pay. Two mechanisms explain most of the difference. The spread is the gap between the best price to buy and the best price to sell, and slippage is the additional movement that occurs when an order is larger than the liquidity at the best price. Neither shows up on a fee schedule, yet both are real costs. This article explains them for readers in South Africa using Binance, OKX, Bybit or Bitget.

Two prices for every market

At any moment, a market has a highest price that buyers are willing to pay and a lowest price at which sellers will sell. The headline price you see is usually somewhere between them. Buying at market means paying the seller's price, and selling at market means receiving the buyer's price, so a quick round trip costs you the gap twice.

Liquidity decides how big the cost is

Deep markets have many orders close together, so the gap is narrow and large trades barely move the price. Thin markets have sparse orders and wide gaps. The same order that is trivial in a deep market can move a thin one noticeably, which is where slippage arises. Looking at the quantity shown at each level of the order book tells you how much your order will move the price.

Estimate before you trade

Before sending a large order, add up the quantities at successive price levels until they cover your size, and compare the resulting average with the best price. If the difference worries you, split the order, use a limit order or choose a more liquid pair. Check convert quotes against the order book as well, because a convenient screen can bundle its own spread into the price.

Measure your actual results

After a few trades, compare the price you expected with the average fill price in your history, and note the pair, size and difference. These records reveal which pairs are expensive for you and how much your habits matter. Fees are explained on the official fee pages; spread and slippage you can only learn by looking at your own fills.

Risk boundary: South Africa Crypto Guide

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Scenario checkpoint

• Look at the best buy and sell prices before ordering
• Read order book quantities against the size of your order
• Split large orders or use limit orders on thin pairs
• Compare convert quotes with the live order book
• Record expected versus average fill price for a few trades