Bid Price
The highest price a buyer is willing to pay for a security right now. You sell at the bid.
The bid price is the maximum price a buyer in the market is currently willing to pay for a security. It is always lower than the ask price.
When you want to sell a security immediately, you "hit the bid" — your sell order fills at the current bid price. Market makers and limit-order book participants on the buy side determine the bid.
The bid is dynamic — it updates continuously as new buy orders arrive or existing ones are cancelled. In fast-moving markets, the bid can gap significantly from the last traded price.
Example
The order book shows a bid of $99.95 and an ask of $100.05. If you place a market sell order, it fills at $99.95. You lost $0.05 per share to the spread compared to the midpoint of $100.00.
Related Terms
Ask Price
The lowest price a seller is willing to accept right now. You buy at the ask.
BeginnerBroker
An intermediary who executes buy and sell orders on your behalf. Modern brokers are typically electronic platforms.
BeginnerLiquidity
How easily you can enter or exit a position without moving the price. High liquidity = tight spreads, deep order books, fast fills.
BeginnerSpread
The gap between the bid and ask price. A tighter spread means lower transaction costs and better liquidity.
BeginnerVolume
Total number of shares (or contracts) traded in a given period. Volume confirms price moves — no volume, no conviction.
Beginner