Trading Basics

Bid-Ask Spread

The gap between the highest current buy offer (bid) and the lowest current sell offer (ask) — a narrower spread generally suggests higher liquidity.

The bid-ask spread is the gap between the “bid” (the highest price a buyer currently wants to pay) and the “ask” (the lowest price a seller currently wants to receive) for a given contract. A narrower spread generally suggests higher liquidity, while a wider spread can mean higher effective trading costs.

See how to read a full Options quote, including bid-ask spread, in Options Terminology Explained: Strike Price, Premium, Expiry, Lot Size.