Every time you buy at the market price you pay the ask, and every time you sell you receive the bid. The gap between the two — the bid-ask spread — is a trading cost that never appears as a line item on a statement. This calculator measures the spread in dollars, as a percentage and in basis points, and shows what it costs to trade a given position.
How to use the bid-ask spread calculator
- Enter the current bid price (the highest price buyers are offering).
- Enter the current ask price (the lowest price sellers will accept).
- Optionally enter the number of shares or units you plan to trade.
- Read the spread on the tape, with the midpoint, spread percentages and the round-trip cost of buying and immediately selling.
The calculator accepts prices with up to six decimals, so it works for currency pairs and sub-penny quotes as well as stocks.
Bid-ask spread formulas
Worked example
A stock is quoted at $49.95 bid and $50.05 ask, and you plan to trade 500 shares.
Spread = 50.05 − 49.95 = $0.10
Midpoint = (50.05 + 49.95) ÷ 2 = $50.00
Spread % = 0.10 ÷ 50.00 = 0.2% = 20 basis points
Buying 500 shares at $50.05 and selling them at $49.95 loses 500 × 0.10 = $50 before any commission — $25 on each side relative to the midpoint.
For a currency pair quoted at 1.08455 / 1.08465, the spread is 0.0001 (one pip), or about 0.92 basis points; on 100,000 units that is $10 per round trip.
Typical spreads
| Market | Typical spread |
|---|---|
| Large-cap US stocks and major ETFs | 1¢, often under 0.05% |
| Small-cap and micro-cap stocks | 0.2% – 2% or more |
| Major currency pairs (EUR/USD) | Under 1 basis point at banks and brokers |
| Equity options | Several percent of the option price |
| Corporate and municipal bonds | 0.1% – 1% or more |
These are rough orders of magnitude; spreads change throughout the day.
Why spreads widen
- Low volume. With fewer buyers and sellers, market makers need a bigger cushion to hold inventory.
- Volatility. During news releases, the open and the close, prices move fast and quotes widen.
- After-hours trading. Extended-hours sessions have far less liquidity than the regular session.
- Low share price. A one-cent minimum tick is 1% of a $1 stock but only 0.01% of a $100 stock.
Reducing spread costs
Use limit orders instead of market orders so you never pay more than you intend, avoid trading thin securities in the first and last minutes of the session, and remember that frequent trading multiplies the cost: ten round trips at 0.2% each cost about 2% of the position.
To judge whether the stock itself is reasonably priced, try the stock valuation ratios calculator, and use the ROI calculator to see how trading costs affect your return.
This calculator is for education and estimates only. It is not investment advice; actual execution prices depend on your broker, order type and market conditions.
Frequently asked questions
What is the bid-ask spread?
It is the difference between the highest price a buyer is currently willing to pay (the bid) and the lowest price a seller will accept (the ask). If a stock is quoted $49.95 bid and $50.05 ask, the spread is $0.10.
How do I calculate the spread percentage?
Divide the spread by the midpoint price, (bid + ask) ÷ 2, and multiply by 100. A $0.10 spread on a $50.00 midpoint is 0.2%, or 20 basis points. Some sources divide by the ask price instead, which gives a very slightly smaller number.
What is a good bid-ask spread?
For heavily traded large-cap stocks and major ETFs, spreads are often a single cent — a few hundredths of a percent. Small-cap stocks, thinly traded ETFs and options can have spreads of 1% or more, which is a meaningful cost on every trade.
Who keeps the spread?
Market makers and other liquidity providers earn the spread by buying at the bid and selling at the ask. For investors it is an implicit trading cost, separate from any commission.