define the terms bid, offer and difference between best ask and best bid?



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detail explanation of terms bid , offer and diff between best ask and best bid?

1 Answer(s)


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BID- When a trader wants to indicate that he wishes to buy a security he will make a bid. Price specified in a buy order is known as a BIDDING PRICE

OFFER-when a trader wishes to convey that he is seeking to sell a security he will make an offer. Price specified in the sell order is known as ASK /OFFER PRICE .

*The highest bid in the market is known as BEST BID and lowest offer price in market is known as BEST OFFER.

*THE DIFFERNCE BETWEEN BEST ASK AND BEST BID IS KNOWN AS BID ASK SPREAD , IT IS ALSO KNOWN AS INSIDE SPREAD AS IT IS OBSERVED WITHIN THE MARKET