NBBO

The National Best Bid and Offer (NBBO) is the best available bid price and best available ask price for a security aggregated across every U.S. exchange and reporting venue at a given instant. It is published by the consolidated tape (the SIPs) and represents the tightest spread the lit market is offering nationally.

The NBBO exists because U.S. equity trading is fragmented across many venues. Under Reg NMS, a marketable order generally cannot execute worse than the NBBO, and Rule 611 (the Order Protection Rule) bars venues from trading through a better-priced protected quote elsewhere. Brokers also owe a separate best-execution duty under FINRA Rule 5310.

Two caveats matter in practice. First, the NBBO is still defined on round lots (now price-tiered — 100 shares down to 1 share for very high-priced stocks under amended Rule 600), but since May 2026 the SIPs separately disseminate the best inside odd-lot orders, so inside odd-lot pricing is no longer dark even though it is not folded into the NBBO itself. Second, the consolidated SIP feed is marginally slower than the direct exchange feeds high-frequency firms pay for — so the 'official' NBBO can lag the true inside market by microseconds.