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  1. Home
  2. /Glossary
  3. /Spread
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Spread

The difference between the highest bid and lowest ask price for an asset.

Definition

The difference between the highest bid and lowest ask price for an asset. Tight spreads indicate liquid markets, while wide spreads mean illiquidity. Market makers profit from the spread.

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Related Terms

Bid Price

The highest price a buyer is willing to pay for an asset right now.

Ask Price

The lowest price a seller is willing to accept for an asset.

Liquidity

How easily an asset can be bought or sold without significantly affecting its price.

Accumulation Phase

A period when smart money quietly buys up an asset before a major price move.

Annualized Return

The average yearly return on an investment, calculated to account for compounding.

Arbitrage

Profiting from price differences of the same asset across different markets.

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