Glossary
Spread: meaning, example and why it matters
The difference between the price you can buy at and the price you can sell at. It is a cost of trading and usually widens when markets are thin or volatile.
Worked example
With a bid of 100.00 and an ask of 100.10 the spread is 0.10, or 0.1% of the price. Buying and selling at once costs that spread.
Illustrative numbers for explanation only. They are not market data, a forecast or a suggestion.
Why it matters
The spread is a cost on every trade, and it widens when markets are thin or fast.
Related terms
Frequently asked questions
Why does the spread change?
It widens when fewer people are trading or when prices move fast, such as around news.
Is this page investment advice?
No. Spread is explained in general terms with illustrative numbers. Market Dekho is not a SEBI-registered Research Analyst or Investment Adviser.
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Educational content, not investment advice. Market Dekho is not a SEBI-registered Research Analyst or Investment Adviser. Spotted a mistake? Email marketdekho01@gmail.com.