Investopedia

Continue to Site »

Inside Quote

Filed Under » ,
Dictionary Says

Definition of 'Inside Quote'

The best bid and ask prices offered to buy and sell a security amongst the competing market makers. The inside quote is the prices at which at which market order will be executed. If it is a sell order, a market order will be executed at the inside bid price. For a buy order, it will be executed at the inside ask price.
Investopedia Says

Investopedia explains 'Inside Quote'

Many retail investors do not realize that the price of a security displayed is actually only the price at which the last trade occurred. If the market for a security is highly liquid and trading is frequent, then this may be a good indication of the current fair market value of the security. However, in less liquid securities, it is important to consider the inside quotes at a given moment, since the last trade may have taken place some time ago, and thus may not be indicative of the current market prices. When trading a less liquid security, traders often use a "limit order to avoid being surprised by the price at which the order executes."

Articles Of Interest

  1.

    Understanding Order Execution

    Find out the various ways in which a broker can fill an order, which can affect costs.

  2. The Basics Of The Bid-Ask Spread

    Understanding the real forces that move stock prices is part of being a good trader.

  3. What's the difference between a Nasdaq market maker and a NYSE specialist?

    What's the main difference between a specialist and a market maker? Not much. Both the New York Stock Exchange (NYSE) specialist and the Nasdaq market maker try to increase the liquidity on their ...

  4. Forex: Demo Before You Dive In

    All trading platforms have benefits and drawbacks - master the fake trade before making a real one.

  5. What is a stock ticker?

    A stock ticker is a report of the price for certain securities, updated continuously throughout the trading session by the various stock exchanges. A "tick" is any change in price, whether that ...

  6. Forget The Stop, You've Got Options

    Using options instead of stop-loss orders adds finesse and control in limiting losses.

  7. The Stop Loss Order

    A stop loss order can protect an investor's portfolio when it is left unattended. Find out more about this market order and how it can work for you.

  8. Introduction To Order Types

    A trade order is an instruction that is sent to a broker to enter or exit a position. Learn about the various types available to investors.

  9. Institutional Investors

    Learn more about the advantages that financial institutions enjoy when buying and selling securities.

  10. Weighted Average

    Learn how to weigh the relative importances of data points in a calculated average.
comments powered by Disqus
Marketplace
Hot Definitions

  1. Pattern Day Trader

    An SEC designation for traders who trade the same security four or more times per day (buys and sells) over a five-day period, and for whom same-day trades make up at least 6% of their activity for that period.

  2. Cost-Push Inflation

    A phenomenon in which the general price levels rise (inflation) due to increases in the cost of wages and raw materials.

  3. Happiness Economics

    The formal academic study of the relationship between individual satisfaction and economic issues, such as employment and wealth.

  4. Affluenza

    A social condition arising from the desire to be more wealthy, successful or to "keep up with the Joneses." Affluenza is symptomatic of a culture that holds up financial success as one of the highest achievements.

  5. Icarus Factor

    The term Icarus factor describes a situation where managers or executives initiate an overly ambitious project which then fails. Fueled by excitement for the project, the executives are unable to reign in their misguided enthusiasm before it is too late to avoid the failure.

  6. Angelina Jolie Stock Index

    An index made up of a selection of stocks from companies associated with actress Angela Jolie.
Trading Center