If I am understanding this correctly, if I wanted to buy this stock, market price is $129 ish. If I want to sell, I'll get about 30% less, $98 ish.

That seems like a huge spread. What are typical causes of that large a spread?

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After the close, traders and market makers pull their bids and offers before going home. That results in the B/A spread widening, more so for illiquid stocks.

For your stock, the quote was $129.34 x $129.37 seconds before the close. Less than 10 seconds later, it was $128.92 x $129.62 and within one minute, it was $98.00 x $129.62 (note the time stamp on your quote).

The lesson to be learned from this? If you're going to trade in the after hours market, make sure not to place a fat fingered trade because you WILL be filled at an outrageously inferior price and there's no recourse when it happens.

  • Great info. How would I determine how Illiquid MIDD is? I'd think it was reasonably liquid.Would that Volume (in screenshot) indicate liquidity? Sep 30 '18 at 20:18
  • @Clay Nichols - You can't determine liquidity by looking at one day's volume. Your link says that 284k shares traded on Friday. Was this a normal trading day? Though we know it now, if this snapshot had been from weeks or months ago, was it a holiday half day or a full day of trading? Was there special news that increased volume? ... Actual facts? MIDD averaged about 618k shares a day over the past year, far short of the 8.67 million shares it traded in May when it announced disappointing earnings. Yes, it's liquid. Sep 30 '18 at 20:38

This is not very common during market hours. Such a spread can only be observed during the pre- and post-market sessions because of pending after market hour orders and Good 'Til Canceled orders.

  • Spreads like that do happen during normal hours but to equities that are extremely illiquid.
    – misantroop
    Sep 30 '18 at 8:37
  • 1
    Hence the phrase: "not very common during market hours" Sep 30 '18 at 17:57

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