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Trade Slippage Analysis Meaning

Trade slippage analysis evaluates the difference between the expected price of a trade and the actual execution price. It measures the cost of executing trades under real market conditions.

Slippage can result from liquidity constraints, latency, volatility, or order size. By analyzing slippage patterns, traders can identify inefficiencies in execution strategy or venue selection.

Institutional desks use slippage analysis to optimize algorithms, improve timing decisions, and reduce hidden execution costs over time.

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