You clicked at one price and the platform filled you at another. That gap is slippage, and on a funded account it can quietly push you past a limit you thought you were nowhere near.
What slippage actually is
Slippage is the difference between the price you expected and the price you received. It runs both ways:
- Negative slippage — you get a worse price than you asked for. A buy fills higher, a sell fills lower.
- Positive slippage — you get a better price than you asked for. It happens more often than traders remember, usually when the market moves in your favour between the click and the fill.
The important mental shift is that a price on your screen is a quote, not a contract. It’s the last price someone traded, or the current best bid/offer. By the time your order reaches the matching engine, that level may already be gone. You don’t trade the number you see — you trade whatever liquidity is actually resting when your order arrives.
Why it happens: liquidity, speed, and news
Three forces drive almost all slippage.
- Liquidity. If there aren’t enough resting orders at your price to fill your whole size, the remainder walks up (or down) the book to the next available level. Thin instruments and off-hours sessions slip more because the book is shallow.
- Speed. There’s always latency between your click, your broker, and the exchange. In fast markets, price can travel several ticks in those milliseconds.
- News. Around a scheduled release — CPI, FOMC, NFP — spreads widen and the book empties out as market makers step back. This is where the worst slippage lives, because low liquidity and high speed happen at the same moment.
Position size interacts with all three: a size that fills instantly at 2am can walk the book badly during a news spike. Sizing to the conditions you actually trade, not the calm ones, is half the battle — a position size calculator keeps that honest when you’re tempted to press.
Market vs limit orders
The order type you choose decides which risk you accept.
| Order type | Guarantees | Slippage risk |
|---|---|---|
| Market | Fills fast | Price is not guaranteed — you take whatever’s there |
| Limit | Price is guaranteed (or better) | Fill is not guaranteed — the market can run away without you |
A market order trades certainty of execution for uncertainty of price. A limit order flips that: you set the worst price you’ll accept, and if the market never trades there, you simply don’t get filled. Neither is “safer” in the abstract — they move the risk to different places. Chasing an entry with market orders in a thin book is one of the most common ways traders bleed ticks they never account for.
Why stop-losses slip exactly when it hurts
Here’s the cruel part. A stop-loss is, mechanically, a market order that fires when price touches your level. So the moment your stop triggers, you’re demanding an immediate fill — during the exact conditions (a sharp move, a news gap, thin liquidity) that produce the worst slippage.
That’s why a stop set at a “1R” loss can close at 1.3R or worse. Over a gap — a weekend re-open, or a violent reaction to data — the next available price can be far beyond your level, and the stop simply fills there. A stop-limit caps the damage but reintroduces the opposite risk: if price blows through your limit, you’re left holding an open position with no protection at all. On a leveraged futures account, that trade-off deserves real thought rather than a default.
Slippage, drawdown, and prop-firm limits
For a prop trader this is not academic. Firm loss limits are measured on your equity, and slippage makes every realised loss a little larger — and every occasional gap loss a lot larger — than your plan assumed. A run of stops that each slip a few ticks compounds into a drawdown number you didn’t model.
Two habits keep it contained:
- Budget for slippage when you size, especially around news. Run your worst realistic loss — not your intended one — through a prop-firm drawdown calculator so the buffer is real, not hoped-for.
- Know your venue. Fill quality varies by broker and by session. A platform with fast, deep futures routing like Tradovate behaves differently in a spike than a thin retail feed, and firms such as Topstep publish their trading windows for a reason — always confirm the specific execution and news rules with your firm.
Because slippage lives in the gap between intent and outcome, it’s easy to under-count in a manual journal — you log the planned loss and forget the extra ticks. This is one reason Shibiki captures fills straight from the account: your edge health is computed from what actually happened, so a slow leak of slipped stops shows up in the numbers instead of hiding in them.
Related: Prop-firm drawdown calculator · Position size calculator · Tradovate integration