2 ms·

So if I buy 1000 shares, I pay $10 in spread fees (1 cent per share)?

• strongvigilance 14y ago
  Generally speaking, yes - the spread is the cost of buying immediately. There is no single price for a stock at any given time. There's a bid price, which is made up of unfilled buy orders, and an ask price, which is made up of unfilled sell orders. The difference between the two prices is the spread. Imagine a stock is bid at $1.00, and offered at $1.02. If you want to buy it, you can have it for $1.02 immediately, since the ask price represents sell orders. If you want to avoid paying the spread, you could place a limit order at $1.00, hoping that someone less patient will sell to you. Alternatively, you could place a buy order at $1.01, which would make this the new market bid price. Again, your order will only be filled if someone else wishes to sell the same price.