> For the complete documentation index, see [llms.txt](https://docs.moonlander.trade/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.moonlander.trade/how-to-use/trading/spread.md).

# Spread

**Spread** refers to the difference between the market price and the **execution price** you receive when opening or closing a position. On our platform, spread can be fixed or dynamically calculated based on multiple factors, and it applies **to all order types at the time of execution**.

## :abacus: How Spread Is Calculated?

Our platform adopts both **fixed** and **dynamic spread** model across the trading pairs.

For **dynamic spread**, it takes takes into account:

* **Existing Open Interest** on the trading pair
* **Size of the New Position** being opened
* **Platform Liquidity** 

This approach ensures that spread adjusts with market conditions, helping reflect the true execution cost more accurately.

## :currency\_exchange: Market Orders

* You can set slippage tolerance on market orders when opening a position.
* In the confirmation step, the estimated entry price includes spread, based on current platform settings.
* The final execution price will closely match the estimated entry price, assuming normal market conditions.

## :currency\_exchange: Limit Orders

* Slippage tolerance does not apply to limit orders.
* In the confirmation step, the trigger price is exactly what you input.
* When the price is reached and the order is executed, the execution price will be adjusted by the spread.

## :currency\_exchange: Closing a Position

* The mark price reflects the current market price.
* At execution, spread is applied to determine the final close price.

## :currency\_exchange: Take Profit / Stop Loss (TP/SL)

* TP/SL prices are user-defined and do not include spread.
* At execution, spread is applied just like with limit orders.
* The estimated PnL shown in the UI already takes spread into account, giving you a more accurate preview.

## :mag: TLDR

Spread is **applied at execution** for all order types:

<table><thead><tr><th width="279.2734375">Order Type</th><th>Notes</th></tr></thead><tbody><tr><td>Market Order</td><td>Est. entry price shown includes spread</td></tr><tr><td>Limit Order</td><td>Trigger price is user input; execution price includes spread</td></tr><tr><td>Close Position</td><td>Spread applied to mark price at the time of closing</td></tr><tr><td>Take Profit/Stop Loss</td><td>Execution price includes spread; Est. PnL reflects it</td></tr></tbody></table>