Bid definition

Bid has a particular significance in relation to IG's platform. Here, we define bid in general investing and explain what it means to you when trading with IG.

In trading and investing, the bid is the amount a party is willing to pay in order to buy a financial instrument. It is the opposite of an ask, which is the price that a seller will take in order to part with a financial instrument.

Bids usually comprise two elements: the price which the buyer is willing to pay, and the quantity of the financial instrument they are looking to purchase. A trade is executed when a matching bid and ask are combined. For example, a trader bidding $100 per share for 100 shares in Apple will see their trade executed when a seller agrees to that price and level.

With IG

The main exception to the above is with market makers like IG. We display both the bid and ask (though we refer to them as the buy and sell) prices. This means that traders who agree to the prices can trade whenever the market is available.

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For more on the terms associated with trading, read our education section.

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