← Glossary · Buying and selling
Spread (bid-ask)
The difference between the buying price and the selling price of a security.
At any moment there are two prices: the ask (at which you can buy) and the bid (at which you can sell). The difference is called the spread.
For heavily traded shares the spread is tiny; for thinly traded ones or outside main trading hours it can be noticeable. It is a hidden cost: buy and sell straight away and you are down by the spread.