Bid / Ask Price
Also known as: bid price, ask price, offer, offer price, bid-ask spread, two-way price, best bid and ask
What is it?
The bid and ask are the two prices a market quotes for any instrument at the same moment. The bid is the highest price buyers are currently willing to pay, and the ask, also called the offer, is the lowest price sellers will accept. When you buy you pay the ask, and when you sell you receive the bid, which means you can never enter and exit at the same number.
Imagine EUR/USD quoted as 1.0850 bid and 1.0851 ask: if you buy a position at 1.0851 and immediately sell it back at 1.0850, you are already down one pip before the market has moved at all. That one-pip gap between the two prices is the spread, and it is the built-in cost you pay on every round-trip trade, sitting in the broker's favour from the first second. The same idea applies everywhere: a stock might show 99.98 bid and 100.02 ask, a four-cent spread, and a thinly traded altcoin or an exotic forex pair can show a much wider gap because fewer buyers and sellers are competing to narrow it.
The common pitfall is reading only the single price on a chart and forgetting that you actually transact across two prices, so a setup that looks profitable on the mid-price can be a loser once the spread is paid both ways. Spreads also widen during news releases and in thin overnight hours, so the gap you see in calm markets is not the gap you always get. Because the spread is a real cost deducted from every trade, frequent trading on wide-spread instruments quietly erodes results, and your capital is at risk on every position you open.
Why it matters: The bid-ask spread is a cost you pay on every single trade before the market moves, so understanding it stops you from mistaking a chart price for the price you will actually get.
Spread = ask price - bid price
The spread is a guaranteed cost on every round-trip trade and compounds heavily for active or short-target strategies.
Real-world example
EUR/USD quoted 1.0850 bid and 1.0851 ask means you buy at 1.0851 and sell at 1.0850 - a one-pip spread paid the moment you open and close the round trip.
How SignalBots handles it
SignalBots' low-latency delivery across Browser Extensions, the MT4/MT5 Connector, and TradingView webhooks narrows the time between a signal and your fill, so the bid and ask you act on are closer to the ones the signal was based on.
Pro tip
Compare the spread to your expected move before entering; a setup targeting five pips on a three-pip-spread pair has most of its edge eaten before it starts.
Common pitfalls
Reading only the mid-price on the chart and forgetting you buy at the ask and sell at the bid, so the spread silently turns a marginal setup into a loser.
Frequently asked questions
What is the difference between the bid and the ask?
The bid is the highest price buyers will currently pay, and the ask is the lowest price sellers will accept. You sell at the bid and buy at the ask, and the gap between them is the spread.
Which price do I get when I buy?
You buy at the ask, the higher of the two prices. When you later sell, you receive the bid, the lower price, which is why the spread is a cost on every round trip.
Why are the bid and ask different prices?
Because buyers and sellers rarely agree on the exact same number at the same instant. The market maker bridges that gap and keeps the spread as compensation for providing liquidity.
What makes a spread wider or narrower?
Liquidity and volatility. Heavily traded instruments in calm conditions have tight spreads, while thin markets, exotic pairs, and news events widen the gap because fewer participants are competing to fill orders.
Does the spread count as a trading cost?
Yes. It is a built-in cost deducted on every round-trip trade in addition to any commission, so factoring it into your targets is essential before you place an order.