Bid-ask is the term used on stocks. It is also known as the spread and is the difference between the stock’s bid price and the ask price of the same stock. Usually, individual exchanges such as NASDAQ or New York Stock Exchange always work for hand in hand with brokers or stock specialists to set the bi-ask price of the security.
Bid-ask spread is ideal in purchasing the security at the best price. The ask price is always high as compared to the bid price. The broker makes a profit from the spread. In short, the bid is the price an investor is willing to pay to purchase a certain stock and at a specified time. The ask is that amount an investor is ready to sell the stock at a specific time.
