Definition
The difference between the bid price and ask price. A measure of market liquidity.
Understanding Bid-Ask Spread
Bid-Ask Spread is an important concept in stock market trading. Understanding this term will help you make better trading decisions and communicate effectively with other traders and financial professionals.
Key Points
- Basic Definition: The difference between the bid price and ask price. A measure of market liquidity.
- Category: This term is commonly used in Trading Basics
- Relevance: Essential knowledge for traders operating in Indian stock markets
Practical Example
When trading on NSE or BSE, you'll encounter bid-ask spread regularly. For example, understanding this concept helps you analyze market conditions, make informed decisions, and manage your trading positions effectively.
Related Concepts
To fully understand bid-ask spread, you should also be familiar with related trading concepts. Check out the related terms in the sidebar for a comprehensive understanding of this topic.