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Questions tagged [bid-ask]

For questions related to the pricing details of securities in markets where there exists the notion of "resting orders" or an "order book".

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8 votes
1 answer
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What is the final price if the bid price exceeds the ask price in an order driven market? [duplicate]

Let's assume a very simplified situation. There is only one seller asking for 10$ and there is only one buyer bidding 20$. At what price would the transaction go? Some answers say it won't, because ...
Mateusz Grotek's user avatar
24 votes
3 answers
38k views

How does a dealer (or market maker) earn the bid-ask spread on a stock?

If I am correct, dealers purchase assets for their own accounts, and later sell them for a profit from their inventory. But the spreads is the difference between buy (or "bid") prices and sell (or "...
Tim's user avatar
  • 5,883
3 votes
2 answers
2k views

How are limit orders executed at market open when the bid price is above the ask price (negative spread)?

In what order and at what price would these orders be executed? Consider the case that both the buyer and the seller submitted orders to their brokers while the market was closed. It seems logical to ...
notAlex's user avatar
  • 142
6 votes
3 answers
3k views

If the spread goes to the market-maker, is the market-maker the exchange?

I understand that the bid-ask spread is the difference between the price a buyer is willing to pay and the price a seller is willing to take for an asset. I also understand that this difference goes ...
Kinnard Hockenhull's user avatar
4 votes
1 answer
162 views

Why didn't my buy limit order become the highest bid?

I am trying to buy a stock that is $307 bid and $312 offered. I placed a buy limit order for 1 share at $307.10. However, the best bid remained at $307.00. After an hour, the best bid is still $307.00....
Flux's user avatar
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1 vote
2 answers
562 views

Confusion on Bid vs. Ask and Spread; Profits

Stock A has a bid price of $100.08, an ask price of $100.10 and a last trade price of $100. I take that to mean that if I buy the stock at $100.10 then I will have lost a total of two cents. How does ...
Ethan's user avatar
  • 49
0 votes
0 answers
69 views

Asked or Bid price which one is right

I recently bought shares on a market where I normally buy and we're confirmed at asked price sorry not bid please see attached pictures and number of shares were confirmed and a congratulations note ...
JOY MATSOSO's user avatar
2 votes
1 answer
1k views

What does it mean in a stock when the Bid volume is 100x higher than the Ask volume?

I'm trying to understand how a certain stock fluctuates, I noticed periods recently when the Bid/Ask volume looks like 50,000/500 give or take. What does this mean in human language in terms of ...
lmlmlm's user avatar
  • 145
2 votes
4 answers
908 views

How do market makers profit from the bid-ask spread when bids are almost always lower than asks?

I am familiar with how currency exchange booths at airports make some of their money: from the bid-ask spread. For example, they will say: "you can sell us 1 USD for 1.32 CAD, and you can buy 1 USD ...
Flux's user avatar
  • 17.1k
2 votes
2 answers
160 views

Bid/Ask when trading ETFs?

Let's say it's an index-tracking ETF. Isn't the ETF price determined by the index value? Why does it have bid/ask spread then? Could someone explain the bid/ask concept when trading ETFs?
Danijel's user avatar
  • 298
0 votes
2 answers
246 views

Do market makers (equities, equity options) continually adjust bid / ask quotes or only adjust after they receive orders?

I’m stuck between two fields of thought, and I’m curious if anyone knows how this works in practice? On one hand, if the MMS have a bid and ask based on current supply and demand and nothing changes,...
Volvire's user avatar
0 votes
1 answer
54 views

Bid/Ask spead for an ETF

I have been looking here for the information on the Bid/Ask spread of the Vanguard Ftse All-World Units Etf A on the Italian market. Here it is reported "Ask: n.d. X n.d" and "Bid: 84,...
MrRobot's user avatar
  • 135
0 votes
1 answer
1k views

Putting it all together: bid, ask and last prices

I have recently started to trade options and am having trouble putting together the bid, ask and last prices. Let me tell you where I am currently at and please correct me if I got anything wrong. ...
Whazzup's user avatar
0 votes
3 answers
1k views

Bid volume greater than offer volume, but price increasing. Why is this?

I'm looking at a 1-minute chart of NQ prices. Using a CQG data feed that provides bid and offer volume. Every minute over a given 5 minute period, the number of shares traded at BID was greater than ...
Neville Nason's user avatar