Bid, Ask, Spread and Why They Matter

Beginner · Beginner Path, lesson 6 of 15 · Trading · 7 min read · Published 19 Oct 2026 · Updated 19 Oct 2026

Every market shows two prices. Learn what the Bid and Ask mean, how the spread becomes a cost on each trade, when it widens, and how it can trigger your stops.

Open any market on Traders Portal and you will see two prices rather than one. The lower one is the Bid and the higher one is the Ask. The small gap between them is the spread, and it affects every trade you make: where you get in, where you get out, and when your stop loss or take profit fires.

This lesson explains what each price means, how to work out what the spread costs you in USDT, when spreads tend to widen, and how the spread interacts with your orders.

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What the Bid and Ask mean

In any market, buyers and sellers are rarely in perfect agreement:

• The Bid is the price buyers are currently willing to pay. It is the price you can sell at.
• The Ask, sometimes called the offer, is the price sellers are currently willing to accept. It is the price you can buy at.
• The spread is the difference: Ask − Bid.

Halfway between them is the mid price. On Traders Portal, each market has a reference price, shown as the Mark Price in Open Positions, and the Bid sits a little below it while the Ask sits a little above it. A market Buy fills at the Ask and a market Sell fills at the Bid.

Your PnL in Open Positions is worked out at the price you would close at, the Bid for a buy and the Ask for a sell. That is why a fresh buy can show a small loss even while the Mark Price sits right next to your entry.

Why every new trade starts in the red

Because you buy at the higher price and sell at the lower one, a position that is opened and immediately closed loses the spread.

The quick formula is: spread cost = spread × position size. Here, 60 × 0.05 = 3 USDT. As a share of the price, 60 ÷ 60,000 = 0.1%.

How much the spread matters depends on your target

The same spread is a small cost for one trader and a large one for another. What matters is how big it is compared with the move you are aiming for.

Gold here is quoted at Bid 2,399.70 and Ask 2,400.30, a spread of 0.60. A trader aiming for 3 points gives up a fifth of the target to the spread on every trade. A trader aiming for 60 points barely notices it. This is why very short-term trading, often called scalping, is so sensitive to spreads.

When spreads widen

Spreads are not always the same size. They usually widen when:

1. Fewer people are trading. Quiet hours, holidays and the gaps between major sessions mean fewer buyers and sellers close to the current price.
2. Big news is due. Before and just after inflation data, interest-rate decisions or company earnings, liquidity providers pull back and spreads stretch.
3. A market opens or closes. Stock and index markets often show wider spreads in the first minutes of a session.
4. Prices are moving fast. In sudden sell-offs or spikes, the gap between buyers and sellers grows.

On Traders Portal, the spread on some markets can widen when the underlying market's own spread widens, so it is worth checking the gap between Bid and Ask before you place a trade at a busy moment.

How the spread affects your stops and targets

This is where the spread catches many beginners out. Orders on Traders Portal are checked against the price that matters for that order:

• A buy position's stop loss and take profit are checked against the Bid, the price it would close at.
• A sell position's stop loss and take profit are checked against the Ask.
• A pending buy order waits for the Ask to reach its price, and a pending sell order waits for the Bid.

So if the spread widens, a sell position's stop can trigger even though the Bid, or the line you were watching on the chart, never reached it.

The spread alongside your other costs

The spread is one of three costs on a trade. The others are the trade fee, the fee shown in the order panel before you confirm, and the swap, a daily holding cost on positions kept open past the daily swap time shown in the market details.

You can see all three on Traders Portal, though in different places:

• Before you trade, the order summary shows Est. entry, which is the Ask for a buy or the Bid for a sell, along with the Fee.
• After you close, the Closed Positions tab lists Fees, Swap and Net PnL. The spread does not appear as its own line, because it is already built into your entry and exit prices.

Trading Costs, Swaps and Fees puts all three together in one worked example, and Order Types Explained shows which side of the spread each order type waits for.

Conclusion

Every market has two prices: the Bid you sell at and the Ask you buy at. The spread between them is a real cost, paid the moment you open a position, and it matters most when your targets are small. Spreads widen when markets are quiet, busy with news or just opening, and because stops are checked against the closing side of the spread, a wider gap can trigger them earlier than you expect. Check the spread before you trade, leave it some room in your stops, and count it alongside fees and swaps.

Topics: CFDs, Risk Management