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📖 Trading term

What Is Spread? Meaning & Example

Definition

The spread is the difference between the highest price a buyer will pay (the bid) and the lowest price a seller will accept (the ask). Narrow spreads usually mean lower trading costs.

Example: If a stock's bid is $10.00 and ask is $10.02, the spread is 2 cents.

Related terms

What is Spread?

The spread is the difference between the highest price a buyer will pay (the bid) and the lowest price a seller will accept (the ask). Narrow spreads usually mean lower trading costs.

Can you give an example of Spread?

If a stock's bid is $10.00 and ask is $10.02, the spread is 2 cents.

Educational only – not financial advice. This page explains ideas and reports the news. It is not a recommendation to buy, sell or hold anything. Markets go up and down and you can lose money. Do your own research and consider talking to a licensed adviser.

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