Bid price

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The bid price ( English bid ) is a market price at which the financial instruments or financial products from a business entity demand be.

It is the highest price at which a market participant is ready in a classic order book trading system with continuous auction , securities , currencies , sorts , precious metalsor to buy any other financial product. Market participant A offers this bid price in order to acquire the paper (through “money”). It can thus be sold directly from a participant B to A at the bid price. So if a market participant wants to sell the paper at exactly this point in time without delay, he can accept the bid price and sell it at this price and thus receives exactly the price that buyer A is willing to pay. In this case the seller is called the price taker .

If the trading system is not a classic order book trading system with continuous auction, then the bid price is not necessarily the highest price at which market participant A is ready to buy a security. An example of this is the Tradegate Exchange . Here the bid price corresponds to the price of the highest limited buy order that has a certain minimum volume. The bid rate at Tradegate Exchange is generally lower than the bid rate in the classic sense, since the bids with small volumes do not increase the bid rate.

The opposite of the bid price is called the ask price ( english ask ). The bid price is usually below the ask price; the purchase price of the paper on the market is lower than the selling price. The arithmetic mean between the bid and ask as a mean rate (also spot exchange rate hereinafter), the difference between the two values as the bid-ask spread ( English bid-ask spread ).

When market prices are published , the suffix G indicates that there was no turnover at the (bid) price, but there was demand.

Individual evidence

  1. BörsG Börsengesetz, Section 30, Paragraph 2
  2. (EG) 1287/2006: Regulation (EG) No. 1287/2006, Article 17, Paragraph 2 (PDF)
  3. (EG) 1287/2006: Regulation (EG) No. 1287/2006, Article 17, Paragraph 5 (PDF)
  4. Tradegate Exchange Rules Section 38, Paragraph 1