The spread
is the difference between two things. Generally, the spread is referred to the
bid and the ask spread (also called the bid and the offer), which is the
difference between the price at which you can sell an asset (bid) and the price
at which you can buy it (ask). Spreads
ExplainedFor example,
if you see that the EUR/USD pair has a bid at 1.1001 and an ask at 1.1002, that
means that the spread is 1 pip or 0.0001. So, you can buy it at 1.1002 and sell
it at 1.1001. The brokers you are trading with generate income through the
spread applying a markup for their services. Another form
of spread is the difference between the yield on two securities for example. If
you have a US bond with a yield of 2% and a German bond with a yield of 1%,
then the yield spread (also called yield differential or credit spread) is 1%.
The spread
is the difference between two things. Generally, the spread is referred to the
bid and the ask spread (also called the bid and the offer), which is the
difference between the price at which you can sell an asset (bid) and the price
at which you can buy it (ask). Spreads
ExplainedFor example,
if you see that the EUR/USD pair has a bid at 1.1001 and an ask at 1.1002, that
means that the spread is 1 pip or 0.0001. So, you can buy it at 1.1002 and sell
it at 1.1001. The brokers you are trading with generate income through the
spread applying a markup for their services. Another form
of spread is the difference between the yield on two securities for example. If
you have a US bond with a yield of 2% and a German bond with a yield of 1%,
then the yield spread (also called yield differential or credit spread) is 1%.
The spread
is the difference between two things. Generally, the spread is referred to the
bid and the ask spread (also called the bid and the offer), which is the
difference between the price at which you can sell an asset (bid) and the price
at which you can buy it (ask).
Spreads
Explained
For example,
if you see that the EUR/USD pair has a bid at 1.1001 and an ask at 1.1002, that
means that the spread is 1 pip or 0.0001. So, you can buy it at 1.1002 and sell
it at 1.1001. The brokers you are trading with generate income through the
spread applying a markup for their services.
Another form
of spread is the difference between the yield on two securities for example. If
you have a US bond with a yield of 2% and a German bond with a yield of 1%,
then the yield spread (also called yield differential or credit spread) is 1%.
