How much spread should I set for backtesting?

Beginner Questions
1

Should I leave it as default on current spread?

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2

Set what your broker uses.

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3

For realistic backtesting, it’s better not to rely only on the current spread since spreads vary by pair, session, and volatility. A good practice is to:

  • Check the average spread of the pair during normal trading hours and use that as a baseline.
  • Add a buffer for high-volatility times like news releases, since spreads often widen.
  • If the platform allows, test with both fixed and variable spreads to see how sensitive the strategy is under different conditions.

Leaving it on the default current spread might make results look better than real trading, so using an average or slightly wider spread usually gives more reliable performance data.

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4

well it depends on what data you are trading! and usually back testing works fine only with fixed spread brokers.

5

It’s best to set the spread to the current value because it automatically modifies the spread when the fixed value changes, and backtesting wouldn’t be necessary. That’s what the broker told me.

6

How are you backtesting exactly? Broker tool or something else?

7

Leave it at the default spread, it’s usually the most realistic for backtesting unless you have specific data from your broker.