Lesson Overview

The Cost of Slippage

You’ve often heard us talk about the important of trading liquid options until you are blue in the face right? Well today we’ll put a dollar figure to this concept and show just how much “slippage” is costing you trading options that are illiquid.

Specifically markets that show a bid/ask spread of just $0.20 could end up costing you more than $3,840 each year - and that’s just the cost of getting into or out of the trade!

As traders we focus too much on our commission costs and rarely if ever do you “feel” the pain that slippage costs your portfolio. It’s time we stop worrying less about commissions and more about slippage by focusing on only highly liquid options and underlying stocks.

More Discussion

Was This Helpful? Add Comments/Questions

  • I mean specifically the full purchase or sale order (all contracts) and the full exit order (all contracts).

eBook Download

The "Ultimate" Options Guide

Ultimate Options Strategy Guide

The step-by-step guide on how to set up each of the top 18+ options strategies we trade to generate monthly income. Read the whole strategy guide in less than 30 mins and have it forever to reference.

Download PDF

Join More Than 47,345 Members

Membership is always free & you can upgrade anytime to unlock our live trades.