Currency & Forex
Intermediate
Bid-Ask Spread
The gap between the price to buy and to sell a currency — the dealer’s markup.
Formula
Variables
SpreadDealer margin
AskPrice you buy at
BidPrice you sell at
Example
Ask 1.1005, Bid 1.1000: spread = 5 pips
Did You Know?
Major pairs like EUR/USD trade at spreads of a fraction of a pip, while exotic pairs can cost many times more.