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Whipsaw Glossary

Currently viewing the definition of: Bid-Offer Spread
 
 
 The difference between the bid and offer prices. 
 


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    • Buy Late
      A short term trading technique whereby a stock is bought late on day one and sold early on day two. Study a 'biggest winers and losers' list for a period of time and it is likely the same names will appear and trends wil emerge. Wait for a stock that has fallen at least 10% - 20% in one day for no apparent reason. This will happen because of events outside the company's control, rather than issuing a profit warning for example. The biggest losses will probably be witnessed for technology stocks or smaller companies. Very often the prices of these stocks bounce back the following day once the market realises the stock has been oversold, and will represent a good buying opportunity. Therefore buy the stock with the required level of loss late in the trading session on day one and sell early the following day once the rest of the market has started to buy. Hopefully a nice profit has been made on the deal.