Price Transparency

DEFINITION of 'Price Transparency'

The accessibility of information on the order flow for a particular stock, allowing knowledge of the quantities of stock being offered and the bids at the various price levels.

BREAKING DOWN 'Price Transparency'

The Nasdaq II quote system provides information on all the bids and asks at various price levels for a particular stock. On the other hand, NYSE quotes display only the highest bid and lowest ask prices. Only the specialist has knowledge of the complete order flow for a stock.

RELATED TERMS
  1. Best Bid

    The highest quoted bid for a particular trading instrument among ...
  2. Limit Order Information System ...

    An electronic system used by specialists in the stock market. ...
  3. Bid Price

    The price a buyer is willing to pay for a security. This is one ...
  4. Bid Tick

    An indication of whether the latest bid price is higher, lower ...
  5. Bid Support

    A manipulative practice employed to prop up a company’s stock ...
  6. Bid Size

    The number of shares being offered for purchase at a specified ...
Related Articles
  1. Investing

    Negotiating the Bid

    A bid is an offer investors make to buy a security.
  2. Markets

    How Bid Price Affects Liquidity

    The bid price is the amount a buyer will pay for a security.
  3. Trading

    What Does Bid And Asked Mean?

    Bid and asked is a two-way price quotation.
  4. Markets

    Stock Quotes Explained

    Curious about how stock quotes are compiled and what a trader should know about how? Read on.
  5. Investing

    The Basics Of The Bid-Ask Spread

    The bid-ask spread is essentially a negotiation in progress. To be successful, traders must be willing to take a stand and walk away in the bid-ask process through limit orders.
  6. Trading

    Introduction To Level II Quotes

    Level II quotes show a ranked list of the best bid and ask prices from each market participant, providing detailed insight into a stock’s price action.
  7. Markets

    Understanding Gold Quote Prices

    Willing to trade gold but puzzled by gold price quotes and terminology? Investopedia explains how to read gold price quotes.
  8. Markets

    How To Read A T-Bill Quote

    If you want buy and sell US Treasury bills, you need to learn to read the quotes.
  9. Markets

    What's a T Bond?

    Treasury bonds, or T-bonds, are marketable securities issued by the US government, and are available in increments of $100. Bonds have a maturity range of ten to 30 years, with 30 being the most ...
  10. Trading

    The Basics Of Trading A Stock

    Taking control of your portfolio means knowing what orders to use when buying or selling stocks.
RELATED FAQS
  1. What do the bid and ask prices represent on a stock quote?

    Learn what the bid and ask prices mean in a stock quote. Find out what represents supply and demand in the stock market and ... Read Answer >>
  2. What do the numbers that follow the bid and ask numbers in stock quotes represent? ...

    When looking at stock quotes, there are numbers following the bid and ask prices for a particular stock. These numbers usually ... Read Answer >>
  3. How are after hour trading rates determined?

    I am new to stock buying and I was just wondering that if I buy stocks after trading hours (normally 4.30 EST for NASDAQ) ... Read Answer >>
  4. What is the difference between a quote driven market and an order driven one?

    The difference between these two market systems lies in what is displayed in the market in terms of orders and bid and ask ... Read Answer >>
  5. Why are the bid prices of T-bills higher than the ask prices? Aren't bids supposed ...

    Yes, you are correct that the ask price of a security should typically be higher than the bid price. This is because people ... Read Answer >>
  6. How do day traders capture profits from the difference between bid and ask prices?

    Discover how day traders capture profits from the difference between bid and ask spreads. These spreads blow out during volatile ... Read Answer >>
Hot Definitions
  1. Duration

    A measure of the sensitivity of the price (the value of principal) of a fixed-income investment to a change in interest rates. ...
  2. Dove

    An economic policy advisor who promotes monetary policies that involve the maintenance of low interest rates, believing that ...
  3. Cyclical Stock

    An equity security whose price is affected by ups and downs in the overall economy. Cyclical stocks typically relate to companies ...
  4. Front Running

    The unethical practice of a broker trading an equity based on information from the analyst department before his or her clients ...
  5. After-Hours Trading - AHT

    Trading after regular trading hours on the major exchanges. The increasing popularity of electronic communication networks ...
  6. Omnibus Account

    An account between two futures merchants (brokers). It involves the transaction of individual accounts which are combined ...
Trading Center