Bid-Ask Spread Explained | Options Trading

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[meo]

Finally, someone who explains bid/ask from both the market viewpoint and my viewpoint! I've been struggling to understand this bid/ask concept and you've really cleared it up for me. Thank You! You've earned a subscriber and a like.

[harrissimo]

Thank you. This video really helped me understand why some of my trades looked good but ended up sucking. Thank You!

[Kris_]

JESUS God forgive me but I've been searching the whole internet trying to find someone who could explain this bid and ask concept to me the right way. Most videos are telling me the bid is when you want to buy and the ask is when you want to sell and I'm like tf that doesn't sound right. 1:11 you explained the whole thing perfectly, thank you my G.

[chicanotrades]

You explain these very well. Thank you my man. One of my nee favorite channels.

[ianmc]

THANK YOU!!! Just a tip for beginners like me to help understand when your buying/selling an option (do I click on bid or ask?). You can't buy an option for cheaper than what you could sell it for. You can't sell an option for more than what you could buy it for. This makes sense...otherwise we'd all be multi multi millionaires.

[danthemann]

Mike, very good video very well explained. I learned so much watching your presentation.

Thank you

[edmhie]

Thank you! explained for I guy like me who is new to options and I subscribed.

[NeroEden]

Awesome video! Very informative and straight to the point! Keep up the great work!

[biswajitbhattacharyya]

Thanks for the video. I was watching to understand the bid and ask concepts. I watched other videos also. But in your video I could confirm that the terms should be considered from the market side. One question please. Is there a percentage of the did and ask spread which we can say fair from profit and loss point of view?

[raulcaetano]

How can we benefit from an arbitrage with bid-ask using Put-Call parity?
For example if we are looking for the correct ask price of a call implied by the parity, given that the Put price is correct, should we equalize C_ask = P_bid - S -PV(K) or C_bid = P_bid - S -PV(K) ?
Thank you! Great video by the way!

[jonathonwright]

So the numbers after the bid and ask are just how many people buying/selling? For example a Bid of .50 x 10 and Ask .75 x 20 would mean 10 people are offering $.50 cents while 20 people are trying to sell for $.75?

[paulojustinianookubo]

I have noticed that in big stocks like amzn, gmc, goog the bid and ask spread is very wide compare to spy or appl. Now this have good volume and good open interest witch it leads me to believe the option is very liquid. Some of them have over a 1000 in volume and open interest why is this? For example the 10 jun 16 weeklys AMZN $730 call has a volume of 1, 309 and open interest of 1, 476. Now the bid and ask is very wide (.20 cents apart). The bid going for $5.10 and ask $5.30. If they are liquid why is the bid and ask so spread out?

[Kris_]

7:56 Wait if the spread is 30 you divide by 2, to get 15 and you say the mid-price is 65 that means you subtracted the 15 from the 0.80 on the ask side?

[ShubhamTiwari-mttz]

Tight bid /ask also indicates big player in stock?

[timpenfield]

Question, If the bid or ask is 100, and i buy 20000 at the ask/bid or above the ask/bid, will it increase the chances of my order being filled? especially when the broker processes the order/lets it go through, or is buying more shares than the ask bid a waste of time, ?

[ShaylaM]

Are you able to explain the direction of the relationship between bid-ask spread and market capitalisation?

[anonymous]

This means that the B/A spread is only relevant if you want to adjust the trade? I'm asking because in case of a CSP or a CC, you might be unwilling to adjust anyways and under those circumstances a high spread would not matter?

[thegodpill]

Does the spread correlate with IV? A high spread is always high iv or low iv? Or is it strictly based off volume metrics?

[edgardosantiago]

If a chart of a stock shows an opportunity for an entry signal (for example:) a long call, at the money, but I can't find an 80 delta and the open interest is high and the bid ask spreads are narrow to placed the trade. What are my options?

[s]

In a direct quote, the forward bid/ask points are added to the bid/ask spot exchange rate whenever the bid points exceed the ask points. True/False