Bid-Offer Spread

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Definition: Bid-Offer Spread

Bid-Offer Spread
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Full Definition of Bid-Offer Spread

Firms wishing to take on the responsibilities of market-making are obliged to quote their prices to broker/dealers who then decide whether or not to respond to them. These quotes are two-way prices, the lower of which is known as the bid price (the price at which the holder can sell shares) and the higher is the offer price (the price at which the holder can buy shares).

The bid/offer spread will be determined by a number of factors- the underlying price of the equity, the sector, liquidity, volatility, takeovers, corporate actions etc.

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February 20, 2025 https://payrollheaven.com/define/bid-offer-spread/.
Chicago Manual of Style (CMS):
Bid-Offer Spread. PayrollHeaven.com. Payroll & Accounting Heaven Ltd.
https://payrollheaven.com/define/bid-offer-spread/ (accessed: February 20, 2025).
American Psychological Association (APA):
Bid-Offer Spread. PayrollHeaven.com. Retrieved February 20, 2025
, from PayrollHeaven.com website: https://payrollheaven.com/define/bid-offer-spread/

Definition Sources

Definitions for Bid-Offer Spread are sourced/syndicated and enhanced from:

  • A Dictionary of Economics (Oxford Quick Reference)
  • Oxford Dictionary Of Accounting
  • Oxford Dictionary Of Business & Management

This glossary post was last updated: 15th February, 2020 | 0 Views.