The Bid-Ask Spread (What Is It?)

The spread is the difference between the bid price and the ask price.

The bid price is the rate at which you can sell a currency pair.

The ask price is the rate at which you can buy a currency pair.

Whenever you try to trade any currency pair, you will notice that there are two prices shown, left price is BID and right price is ASK.

The spread is brokerages commission on that trade, that is why all trades start off in negative until that spread is negated before turning profitable.

For Your Information:

The lower price is called the “Bid” and it is the price at your broker (through which you’re trading) is willing to pay for buying the base currency.

The higher price is called the ‘Ask’ price and it is the price at which the broker is willing to sell you the base currency against the counter currency.