What is the difference between bid and ask?

In the financial markets, the terms "bid" and "ask" play a fundamental role in setting the tempo for a myriad of transactions. The "bid" refers to the maximum price a buyer is willing to pay for a security, commodity, or currency. In contrast, the "ask" represents the minimum price a seller is willing to accept for the same.

What are bid and ask prices?

In stock markets, bid and ask prices are constantly changing as traders place their orders. These prices are an indicator of the price traders are willing to buy (bid) or sell (ask) a stock at any given point in time. Large bid-ask spreads can indicate lower liquidity and higher potential transaction costs.

What is the difference between bid and ask price in stock trading?

In stock trading, the bid price refers to the highest price that a buyer is willing to pay for a certain security, and the ask price refers to the lowest price that a seller will accept. Both the bid and ask will change over the course of a trading day. What Is the Difference Between the Bid and Ask Price of a Stock?