Glossary term
Bid-Ask Spread
The gap between the highest buy price and the lowest sell price; the primary execution cost in any market.
The Bid-Ask Spread is the gap between the highest price buyers will pay (bid) and the lowest price sellers will accept (ask). It is the primary cost of execution, paid implicitly on every round-trip trade, and widens in illiquid or volatile conditions. The spread matters in both options chains and prediction-market contracts, where wide spreads can quietly erase a position's expected edge. See Liquidity (Prediction Markets) and Prediction Market Risk 101.