Bid/Ask—The Difference Is in the Spread!
All traders once paid a per-lot price, but recent changes now stipulate traders pay a spread between the bid and ask. Currencies are now quoted in bid/ask thanks to retail brokers that sell currencies back to the interbank market. Bid/ask can also be viewed in the context of bid/offer, buy/sell, borrow/lend, and even deposit/lend where deposit rates create a floor and lend rates create a ceiling. The difference is the spread.
The bid appears on the left side of a currency pair and that is the quote to sell while the ask is the price to buy and appears on the right. The ask always exceeds the bid. Ask minus bid equals the cost of a trade per one lot. The price of a spread depends on liquidity of the market ...
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