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Define “spread” and “spread size.”

Define “spread” and “spread size.”

Engineering   Chemical-Engineering   
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Answer #1

spread is the difference between the prices quoted for an immediate sale of any product and an immediate purchase (bid) for stocks, futures contracts, options, or currency pairs. This is simplied version definition for spread.In most of the cases we deal based on the size of product and for this we define size of a spread/spread size.

The size of the bid-offerspread in a security is one measure of the liquidity of the market and of the size of the transaction cost. And spread size measures the cost of making transactions/buying selling values of a product.

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