Execution

Execution is the act of filling a trader's order, whether to open a new position or close an existing one. When a trader submits an order, the broker's system processes it, matching it with available liquidity providers or internal books. This process determines the exact price at which the trade is confirmed and becomes active in the market, reflecting the agreed terms between trader and broker.

For a retail trader, execution quality directly impacts profitability, especially for high-frequency strategies. Poor execution can result in slippage, where the final fill price differs from the requested price, potentially costing several pips on a volatile asset. It also encompasses the speed and reliability of trade placement, which is crucial for managing risk and capturing fleeting market opportunities.