Buy and Sell, Bid-Ask

What this video covers

• The exact difference between a bid and an ask, including why the ask is always higher and they are never the same dollar amount
• Why a customer buys at the ask (the higher price) and sells at the bid (the lower price), making the customer price-taker on both sides
• What the spread represents as the ask minus the bid, and how it functions as the dealer's profit opportunity plus the customer's cost of immediacy
• How a narrow spread signals high liquidity with many participants and low transaction costs, and why a wide spread means low liquidity
• Why a large-cap stock like Apple might carry a one-cent spread while a small-cap stock can show 50 cents or more
• The classic exam trap about which price is "better" for the customer, since neither bid nor ask is favorable to the customer