Spread vs Commission

Look-alike pair

Spread and commission are both costs charged by a broker, but they are not the same thing: the spread is the difference between the bid and ask price built into the quote, while the commission is a separate fee charged per trade. The single difference that matters is that the spread is always embedded in the price you see, whereas a commission is billed on top of it.

Side by side

	Spread	Commission
What it is	The gap between the best bid and best ask price for an instrument.	A separate charge per trade, often per share, per contract, or per lot.
How it is paid	Implicitly: you enter and exit at prices that already include the spread.	Explicitly: deducted from your account balance or added to the trade cost.
Field mark	You see two prices (bid and ask) with a small difference between them.	You see a line item on your statement or trade confirmation labelled 'commission'.
Typical variation	Spreads vary by broker, instrument, market conditions, and account type.	Commission structures vary by broker, country, regulator, and product.
Visibility	Always visible as the bid-ask difference before you trade.	Often disclosed separately, sometimes only after the trade is executed.
Impact on cost	Affects your effective entry and exit price, so it is part of your P&L.	Adds a direct cost that reduces your net profit or increases your net loss.

Which word to use

Use spread when you are talking about the price difference you see in the quote, and use commission when you are talking about a separate fee charged for executing the trade.

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