Bid and Ask

Ask is simply the price in a market at which an asset can be bought (i.e. the price at which it is being sold). The ask price is usually also quoted with the amount of the asset which the seller is prepared to sell. Ask is the opposite to bid and both terms are used in almost every single financial market across all asset classes. Ask is always given in the format (quantity) at (price). An example of an ask is:

• “100 at $3”

This means the seller is willing to sell 100 units of the asset at $3 per unit, for a total value of $300.

Bid is simply the price in a market for which an asset can be sold (i.e. the price at which it is being bought). The bid price is usually also quoted with the amount of the asset which the buyer is prepared to buy.

Bid is the opposite to ask and both terms are used in almost every single financial market across all asset classes and it is given in the format '(price) for (quantity)'.

An example of a bid is:

• “$5 for 50”

This means the buyer is willing to buy 50 units of an asset for $5 per unit for a total cost of $250.

Free Resources

To continue learning and advancing your career, check out these additional helpful WSO resources:

• Retained Earnings
• Fraud Triangle
• Accounts Receivable Turnover Ratio
• Marginal Cost Formula
• Nash Equilibrium