What Is the Bid-Ask Spread, and Why Does It Widen?

At 11:59 am ET on 15 October 2026, Apple's shares were quoted at a bid of $343.20 and an ask of $343.23, a spread of 3 cents. Park Aerospace was quoted at $26.07 and $26.14, a spread of 7 cents. At those quotes, buying and then selling $10,000 of Apple cost $0.87. The same trade in Park Aerospace cost $26.81.

A spread of a few cents can be a small cost on one stock and a large one on another. This guide uses readings of eight stocks and funds, taken between 11:33 am and 12:30 pm ET on one day, to show what the spread is and what widens it. It also covers why the open differs from mid-session. The open itself was not measured.

A quote has two sides. The bid is the highest price at which someone is offering to buy. The ask is the lowest price at which someone is offering to sell. The spread is the ask minus the bid.

A market maker quotes both sides and earns the spread when buyers and sellers arrive at different moments. We cover the role in what a market maker does and how it earns the spread.

Two measures make spreads comparable. The mid-price is the bid plus the ask, divided by two. The spread in basis points is the spread divided by the mid-price, times 10,000. A basis point is 0.01%, so on a $10,000 trade the cost of buying at the ask and selling at the bid is the spread in basis points, in dollars.

The table uses the reading nearest noon ET on 15 October 2026, a time fixed before any reading at noon existed. The bid and ask come from the quote page on Nasdaq.com. The Apple reading was taken at 11:59:47 am ET and the Park Aerospace reading at 11:59:54 am ET.

Source: Nasdaq.com quote page, read on 15 October 2026; YX Insights calculations

For Apple, 3 cents divided by $343.215 is 0.0087%, which is 0.87 basis points. On $10,000 that is $0.87. For Park Aerospace, 7 cents divided by $26.105 is 0.268%, which is 26.81 basis points, or $26.81 on $10,000.

In cents, Park Aerospace's spread was 2.3 times Apple's. As a share of the price it was 31 times as large.

One reading is one moment. Across the window, Park Aerospace's spread moved between 6 and 19 cents. Apple's moved between 2 and 8.

The cost above assumes the whole trade fills at the quote. We did not test fills. We also did not confirm that the quote page shows the best bid and ask across all venues.

The eight names were picked by hand to span a wide range of trading activity. They are a selection, not a sample of the market. All the readings below were taken on 15 October 2026, between 11:33 am and 12:30 pm ET.

The chart shows each name's median and range of cost over the 77 readings, taken about every 45 seconds. Names are ordered by shares traded by noon ET. The three most-traded names had median costs of $0.39 (SPY, a fund that tracks the S&P 500), $1.16 (Apple) and $1.49 (Microsoft).

The ladder is not perfect. Nathan's Famous had traded about 7,800 shares by noon. Its median cost was $6.87. Park Aerospace had traded about 59,000. Its median cost was $35.

Nathan's Famous was quoted around a $101.915 mid-price at noon, so the same 7-cent spread is a far smaller share of it than of Park Aerospace's $26.105. Every spread in the readings was a whole number of cents. None was below 1 cent.

A market maker that buys 1,000 shares from a seller now holds 1,000 shares it did not plan to hold. Until a buyer arrives, a fall in the price is the market maker's loss. The longer the wait, the further the price can move. The spread is one way a market maker is paid for carrying that risk.

In a 1995 study of Nasdaq stocks, Chan, Christie and Schultz found that spreads were relatively stable through the day and narrowed significantly near the close. The authors wrote that the narrowing was consistent with inventory control by individual dealers.

Adverse selection is trading against someone who knows more. Suppose a buyer lifts the ask just before good news. The market maker has sold at a price that is about to look too low. It cannot tell which orders are informed.

A 1993 study of NYSE stocks by Lee, Mucklow and Ready found that spreads widened and depths fell in anticipation of earnings announcements. The effect was larger for announcements followed by larger price changes. The authors wrote that their results suggest liquidity providers are sensitive to changes in information asymmetry risk and use both spreads and depths to manage it.

Two things differ at the open. The first is information. News arrives while the regular session is shut.

On 15 October 2026, the 9:30 am ET point on Nasdaq.com's price chart was $346.24 for Apple, 0.96% above its previous close of $342.96. SPY's was $765.96, 0.47% below $769.60. Park Aerospace's was $25.80, 1.98% below $26.32.

The second is order flow. At the open a market maker has traded little that day. It has seen few of that day's orders, so it cannot yet tell whether early orders are informed or whether they are pushing its inventory one way.

McInish and Wood studied NYSE stocks in a 1992 paper. After allowing for activity, risk, information and competition, they found spreads were higher at the beginning and end of the day than in the middle.

Chan, Christie and Schultz, using Nasdaq stocks, found spreads relatively stable through the day. They attributed the difference to structural differences between specialist and dealer markets.

Both papers were published in the 1990s. Our readings start at 11:33 am ET, so we did not measure the open in 2026 quotes.

In a name that trades few shares, fewer orders rest at each price. One order added or cancelled can move the best bid or ask. A market maker holding shares also waits longer for the other side to arrive.

Park Aerospace's spread took 12 different values across the 77 readings, from 6 to 19 cents. It changed between readings 41 times. Apple's took 7 different values, from 2 to 8 cents. It changed 51 times. The thin name moved less often here, so these readings do not show a thinner book producing jumpier quotes. What differs is the size of the move: Park Aerospace's spread ranged over 13 cents against Apple's 6.

Between 11:33 am and 12:30 pm ET on 15 October 2026, the median cost of buying then selling $10,000 ran from $0.39 on SPY to $191 on Escalade.

The readings show how wide spreads were across eight names. They do not separate the four causes, which this guide takes from the studies and from the mechanics of quoting.

This explainer is part of the YX Insights Academy. Each one takes a single idea and checks it against real data.

The same approach runs through everything else we publish:

Good places to start on the website:

The bid-ask spread is the ask price minus the bid price. The bid is the highest price a buyer is quoting. The ask is the lowest price a seller is quoting. At 11:59 am ET on 15 October 2026, Apple's spread was 3 cents on a $343.215 mid-price. We explain the quoting role in what a market maker does.

Two things differ at the open: information and order flow. News arrives while the session is shut. A market maker has also seen little of that day's orders. McInish and Wood found higher spreads at the start and end of the day for NYSE stocks in 1992. We did not measure the open.

Four things appear in this guide: inventory risk; trading against better-informed traders; uncertainty around news and the open; a thin order book. On 15 October 2026, Escalade, with about 8,100 shares traded by noon ET, had a median cost of $191 per $10,000. SPY's was $0.39.

Subtract the bid from the ask. Divide by the mid-price, which is the bid plus the ask divided by two. Multiply by 10,000. For Park Aerospace at 11:59 am ET on 15 October 2026, 7 cents divided by $26.105, times 10,000, is 26.81 basis points.

It is a cost when a buyer pays the ask and a seller receives the bid. On a $10,000 round trip, the readings at 11:59 am ET on 15 October 2026 imply $0.87 for Apple and $26.81 for Park Aerospace. Real fills can differ from the quote.

DISCLAIMER: This article is strictly educational. Any information or analysis in this note is not an offer to sell or the solicitation of an offer to buy any securities. Nothing in this note is intended to be investment advice and nor should it be relied upon to make investment decisions. Any opinions, analyses, or probabilities expressed in this note are those of the author as of the note's date of publication and are subject to change without notice.