Bid and ask

(redirected from Bid-ask)

Bid-Ask Spread

On an exchange, the difference between the highest price a buyer of a security or other asset is willing to pay and the lowest price a seller is willing to offer. Generally speaking, the more liquid an asset is, the lower the bid-ask spread is. As a result, currency, which is considered the most liquid asset, has an extremely low bid-ask spread.

Bid and ask.

Bid and ask is better known as a quotation or quote.

Bid is the price a market maker or broker offers to pay for a security, and ask is the price at which a market maker or dealer offers to sell. The difference between the two prices is called the spread.

References in periodicals archive ?
The stock up 12c to $12.85 and Apr 13.5s trade across the exchanges for 17c, including a 12.9K block on PHLX with bid-ask 16 to 18c.
However, we document a more significant rise in bid-ask spreads in the United States during the ban, driven primarily by an increase on the ask side of the market due to the relative scarcity of long sellers in the United States.
As shares shed 1% to $2.21 Wednesday after earnings, 40K Jan 2 puts traded 25.5c with bid-ask 21 to 34c and opened a new position (now represents more than half the aggregate OI in the name at 40.5K contracts).
Built on tight SPY option bid-ask spreads, SPIKES Index offers radically faster dissemination, publishing every 100 milliseconds as opposed to every 15 seconds.
A liquidity provider is required to enter bid-ask orders to permanently reduce the bid-ask spread to 10 tick sizes or lower during the continuous session.
Another goal for this paper is to compare the performance of five bid-ask spread estimation models in markets with different levels of liquidity.
We examine the time-series relation between aggregate bid-ask spreads and conditional equity premium.
Brennan recommends that advisors and investors evaluate bid-ask spreads when choosing between similar ETFs.
420) categorize the bid-ask spread as an explicit cost and Huang (2013, p.
The European Commission has found that four international banks, RBS, UBS, JP Morgan and Credit Suisse, operated a cartel on bid-ask spreads of Swiss franc interest rate derivatives in the European Economic Area (EEA).
Confronted with the potential loss, the liquidity providers may widen the bid-ask spread to avert such loss.