Section 2 · Market Mechanics
Slippage & Execution
The silent tax on every trade — and how to minimize it.
Slippage is the silent tax on every trade.
Expected fill vs actual fill. $0.01 on AAPL, $0.50+ on volatile small-cap. Momentum traders in and out of dozens of trades per week — slippage compounds into real money.
3 things to know
Slippage = the difference between the price you expected and the price you got.
Fast-moving momentum stocks have the highest slippage — the price moves as you order.
Limit orders eliminate slippage at the cost of potentially not filling.
Dive Deeper
Key vocabulary — tap each card
Practice
Slippage cost calculator
Estimated slippage cost at $0.50/share
$250
Reduce share size on thin stocks to control total slippage cost
Did you know?
Use limit orders on momentum trades whenever possible. A limit order at $0.05 above the current ask gives you price control and usually fills — with far less slippage than a market order on a fast mover.