The Bid Price is the highest price a buyer is willing to pay for a security at any given moment.
Order Book Structure
| Level | Bid Price | Quantity | Ask Price | Quantity |
|---|---|---|---|---|
| Best | 100.50p | 5,000 | 100.60p | 3,000 |
| Level 2 | 100.40p | 10,000 | 100.70p | 7,500 |
| Level 3 | 100.30p | 15,000 | 100.80p | 12,000 |
The best bid (100.50p) is the highest price buyers offer. The difference to the best ask (100.60p) creates the spread.
How Bids Work
On SETS, bids form a ladder with the highest price at the top. Multiple orders at the same price execute by time of entry (price-time priority). The bid updates continuously as orders arrive or execute.
Market Conditions
| Condition | Description | Implication |
|---|---|---|
| Normal | Bid < Ask | Positive spread, trading possible |
| Locked | Bid = Ask | Zero spread, rare in electronic markets |
| Crossed | Bid > Ask | Error state, triggers immediate execution |
Market Maker Bids
On quote-driven platforms like SETSqx, market makers must display firm bids with obligations to:
- Buy at quoted price for minimum quantity
- Keep spread within regulatory maximums
- Maintain quotes during trading hours