Tag: Bid & Ask Spread

The bid & ask spread is the variance between what investors are willing to pay (the “bid price”) and what they are asking to receive (the “ask price”). It can be an important factor in determining the price of a security and plays a role in the liquidity of the market. Knowing the bid & ask spread can help investors determine whether to buy or sell a security and how quickly they can do so. The spread between the two prices can vary significantly from one security to the next, and it is a factor that should be carefully considered when making any investment decision.

Forex Trading

How Does Bid & Ask Spread Work in Forex Trading? – Academic Guide

By Matthew M. Lockett
August 22, 2023

4 min read

When trading forex, traders need to be aware of the Bid and Ask spread. This is the difference between the Bid price, the current price at which the trader can open a position and the Ask price, the current price at which the trader can close a position. The spread is typically measured in pips and can vary from a few pips to a hundred pips or more in extreme cases. The Bid-Ask Spread can affect the outcome of a trade, so understanding it is important for successful trading. The wider the spread, the more difficult it can be to make profitable trades. The smaller the spread, the more likely the trade will be successful. Knowing how Bid and Ask Spread works can help traders maximize their profits and reduce their risk.