Trading Concept
Spread
The difference between the highest bid price and the lowest ask price for an asset — the cost of immediate execution.
The spread is the market's price for immediacy. A buyer who wants to trade now pays the ask. A seller who wants to trade now hits the bid. The difference — the spread — is the cost of that immediacy. Narrower spreads mean lower costs. Wider spreads mean the market is pricing in uncertainty or illiquidity.
Spreads vary by platform, asset, and time of day. Major crypto pairs on Binance might have spreads of 0.01%. Illiquid prediction markets on Polymarket might have spreads of 3–5%. A collectible card on TCGPlayer might have a spread of 10–15% between the lowest listed price and the highest buy offer.
Understanding the spread is essential for strategy configuration. A mean reversion strategy on an asset with a 5% spread needs the price to move 5% beyond the mean just to break even on the round trip. The botwir3 builder does not model spreads directly — the adapter reports the current bid/ask and the strategy module accounts for it in signal generation.