Financial Terms Explained (Pt2)

The main way we can protect ourselves in the world of finance has always been knowledge. Banks and financial agencies are masters of this and will employ “technical” terms, even use the law to rid you of your hard-earned dollars. Whatever country you belong to the financial language, however, remains the same. I will use bold italics to simplify the terminologies.   Here are three financial terms you need to know:

Ask – Ask is the price a seller is willing to accept for a security, which is often referred to as the offer price. The lowest price the seller is willing to sell the item you want.

Bid – A bid is an offer made by an investor, a trader or a dealer to buy a security, commodity or currency. It is the highest price you are willing to pay for the item that you desire to have.

Spread – A spread is the difference between the bid and the ask price of a security or asset. The gap between the asking (selling) price and the bidding (buying) price.

All references can be found on www.investopedia.com 

 

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s