GlossaryIntermediate
Bid-Ask Spread
The gap between the highest price buyers offer and the lowest price sellers accept.
The bid-ask spread is the difference between the highest price a buyer is currently willing to pay (the bid) and the lowest price a seller is currently willing to accept (the ask).
A narrower spread generally indicates a more liquid, actively traded market, while a wider spread can indicate lower liquidity or greater uncertainty about an asset's price.
Examples
- A market order executed immediately will typically cross at least part of the bid-ask spread.
- Less-traded assets often have a wider bid-ask spread than well-established ones.