I’ve noticed that spreads seem tighter on some brokers during calm market hours, but I’m worried about what happens when news drops. Major economic releases can cause wild volatility, and I’ve heard some brokers widen spreads significantly while others hold relatively steady.
I’m trying to figure out if I should prioritize a broker with naturally tight spreads in normal conditions and just accept that they’ll widen during news, or if I should look for a broker that’s known for holding spreads better during volatile times.
Does this actually matter for your broker decision, or is it just a minor concern? Should I test this myself before opening an account, or is it something every broker struggles with anyway?
Also, if I’m using rebates through GlobeGain to lower my costs, does that change how important spread stability during news becomes?
News spreads matter if you scalp. Hold traders can ignore it.
Most brokers widen spreads. Good ones stay reasonable.
News widening is normal, but the amount varies significantly. A broker with 1.0 pip spreads that jumps to 4-5 pips during NFP is worse than one jumping from 1.5 pips to 2.5 pips.
If you scalp or day trade with high frequency, spread stability matters heavily. If you hold positions for hours or days, it’s less critical.
Test this yourself: open a demo account and watch EUR/USD spreads for 30 minutes before, during, and after major news releases. You’ll see the pattern immediately.
Rebates don’t change this equation. A 0.4 pip rebate helps at 1.0 pips baseline, but it doesn’t help when spreads blow to 5 pips during news. Your cost still spikes.
I tested this with three different brokers during news events last month. The spread swings varied way more than I expected.
One broker held around 2-3 pips wider, another jumped to 5-6 pips, and a third stayed relatively stable at 2 pips. That made a big difference for my intraday trades.
If you’re planning to trade around news, definitely spend an hour or two watching how different brokers handle volatility. It’s worth the effort upfront.
I specifically tested this last year because I trade around major releases.
Some brokers held spreads reasonably tight (2-3 pips wider), others went crazy (4-6 pips wider on majors). The difference directly impacted my P&L on volatility trades.
I can’t avoid news because it’s often when the biggest moves happen. So I factored in this cost when choosing between brokers.
The broker with the tightest spreads during calm times wasn’t always the best choice. The one that balanced normal spreads with decent stability during volatility turned out to be cheaper overall.
GlobeGain rebates help, but they don’t offset a 6 pip spread. Test on a demo during a scheduled news event and you’ll get clarity fast.