Bid Price
| Bid price is the amount at which an investor is willing to buy a security. It is usually used in reference to stocks, but can also be applied to bonds, commodities, currencies, and other assets. The bid price is the price that a market maker or specialist is willing to pay for the security. The bid price is different from the ask price, which is the price that the market maker or specialist is willing to sell the security. The bid price is important because it is the price at which the security will be bought if the order is executed. The bid price is also the starting point for determining the market price of the security. The market price is the price at which the security is trading in the market. It is the price that a buyer and seller are willing to trade the security at. The market price is determined by the bid and ask prices. The bid price is also used to calculate the bid-ask spread. The bid-ask spread is the difference between the bid price and the ask price. It is a measure of the liquidity of the security. The bid-ask spread is important because it represents the cost of trading the security. The bid-ask spread is also a measure of the market maker's or specialist's profit. |
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