Trades start with negative pips due to the Spread of the trading instrument. Spread is the difference in pip size between a trading instrument's Bid price and Ask price. In simple terms, it is the cost of an executed order. When you execute a buy or sell order, the system will perform individual checks to ensure that your funds exceed the cost of spread and the margin. Once that is done, it is immediately calculated as a floating loss, resulting in trades starting with negative pips. Therefore, you must overcome the price difference to break even on your trade, i.e., your trade has to go in a profitable direction to make profits.

Please note that spread is the main source of profit for many brokers, including Exness. On the real market, spread increases as Trading Volume increases; however, Exness provides extremely stable spreads independent of order sizes. The average value offered for each trading instrument varies; more details can be found on our contract specifications page.

Let us take a look at how Spread is calculated:

Assume you placed a BUY order on a Standard account with a Leverage of 1:2000 for 5 lots of EURUSD at an opening price of 1.04620/1.04630 and closed the position at 1.04680/1.04690.

Below is a breakdown of how the spread is calculated:

Spread = (Ask price - Bid price) / Pip size (1.04630 - 1.04620) / 0.0001 = 1 pip

Pip value = Lot × Contract size × Pip size (5 × 100000 × 0.0001) = 50 USD

Pip value can easily be calculated on the Investment Calculator.

Cost of Spread = Spread in pips × Pip value = 1 × 50 = 50 USD

The Cost of spread is USD 50, which will be a floating loss when the trade is opened.

The price movement will determine if the trade will go in a profitable or unprofitable direction.

Profit for BUY orders = [Closing Price (Bid) - Opening Price (Ask)] / Pip size × Pip value = (1.04680 - 1.04630)/ 0.0001 × 50 = 250 USD

The trade Profit rewarded to the client will be 200 USD; 50 USD cost of the spread is to be deducted automatically by the broker.