What is Bid-Ask Spread?
Jasmine Harrison
16 Nov 2022
450 views
The bid-ask spread is the difference between the bid and ask prices of a currency pair. It is a trading cost that is automatically applied for each trading position.
The bid-ask spread is the difference between the ask (sell) and the bid (buy) price of a pair. The ask price indicates the level at which sellers are ready to sell, while the bid price is the level at which buyers are ready to buy. The spread would automatically be charged to each position when they're opened. In the MetaTrader platform, it can be seen in the Market Watch session.
From the picture above, the GBP/USD pair is shown to have a spread of 5 points as the bid price is 1.22823 and the ask price is 1.22828. So the calculation is 1.22828 - 1.22823 = 5 points.