Spread

The gap between the bid and the ask.

In plain English

A cost you pay on every round trip, whether or not it appears as a line item. Wider spreads mean a larger move is needed simply to break even.

Example

A bid of 99.8 and an ask of 100.2 is a spread of 0.4, or roughly 0.4% of price.

Trading Basics

See also

Used in these lessons

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