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Technology Stocks : IFMX - Investment Discussion
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To: Anita J. who wrote (12882)1/27/1999 3:17:00 AM
From: Marq Spencer  Read Replies (1) of 14631
 
Anita,
The "bid" price is the highest price that some buyer is willing to pay. The "ask" price is the lowest price the seller is willing to sell for. If ask and bid were the same, the entity (stock, option, whatever) would be sold. So, if the ask is $1, and bid is $3/4, then there wouldn't be a sale unless one of the following happens - a seller comes in who's willing to sell for $3/4, or a buyer comes in who's willing to buy for $1.

If you place a limit price at the bid ($3/4 in the above example) your order will wait until a seller shows up who's willing to drop the price to $3/4. Hope this helps.

>Since I'm new to this options game, I really don't understand the mechanics behind it either.<

I'd recommend reading about this stuff before you try to trade options. Otherwise, you'll end up learning at your expense.

- Brian.
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