Yuka Group Inc. (YUKA)

[ahab333]

I care to differ.

What is the difference between the "bid" and "ask" price of a stock? Which one should I pay when I buy?

A: If you've ever traded in a car at car dealership, you understand the difference between the "bid" and "ask" price of a stock.

The bid is the price the dealer is willing to pay to buy from you, be it your used car or a stock you're selling. If you roll onto a car lot with a 1993 four-door Ford Escort LX Hatchback with 100,000 miles, you can expect the dealer to pay $675 if it's in good condition, according to Kelley Blue Book. That's the "bid" price.

But if you went to the dealer to buy the same car, the dealer would sell it to you for $2,220. That's the ask price. The "spread" is the difference between the two: $1,545 in the case of the car.

The same goes for stocks. If you're looking to sell a stock, a broker will offer to buy it for one price, the bid. And if you're looking to buy it, the broker will offer to sell it to you for another, higher ask price. The spread is the broker's profit.

GLTU