Two prices on every quote
When you see a price, there are always two sides:
- Bid — the price at which buyers are willing to purchase (you sell at the bid).
- Ask (offer) — the price at which sellers are willing to sell (you buy at the ask).
The spread = Ask − Bid. It is a direct cost: you start each trade slightly negative because you buy at the higher ask and sell at the lower bid.
Practical tip
Spreads widen during news events and low liquidity (e.g. holidays). Compare spreads on your broker’s contract specifications page.