An offer is the price at which a seller is willing to sell a security right now. On many platforms you will also see it called the ask. The best offer is simply the lowest sell price available at this moment.
The word also appears in corporate contexts. A company or bidder can make an offer to buy shares from existing holders, as in a takeover or tender offer, and new issues come with an offer price set for the sale.
How the offer sits in the order book and shapes the spread
In an order-driven market, participants place buy orders at various prices and sell orders at various prices. The highest buy price is the best bid. The lowest sell price is the best offer. The gap between them is the bid‑offer spread, a basic cost of trading.
Example: if the bid is 100.00 and the offer is 100.20, the spread is 0.20. The mid price is 100.10, found by averaging the two. If more sellers appear and undercut one another, the offer may move down and narrow the spread. If sellers pull their orders or buyers get more aggressive, the offer can move up.
On quote-driven venues, a market maker posts a two-sided quote, showing both a bid and an offer at which they stand ready to trade. The size they display on the offer tells you the number of shares or contracts they are willing to sell at that price.
Best offer, size and depth: what traders actually watch
Traders look beyond the single best offer. They watch the size at the best price and the depth of the book, which shows how much supply exists at the next levels up. This helps judge how far a buy order might push the price.
Suppose you see:
- Offer 100.20 for 1,000 shares
- Offer 100.25 for 500 shares
- Offer 100.30 for 2,000 shares
A market buy of 1,200 shares will likely take 1,000 at 100.20 and 200 at 100.25, lifting the average fill above the displayed best offer. This slippage is why depth matters, especially in thin or fast markets. The reverse is true when a large seller leans on the book and the best offer refreshes lower as buy orders are consumed.
Not all available supply is visible. Some orders are hidden or pegged, and in some markets blocks are negotiated away from the order book then reported after the fact. What you see as the best offer is still the reference for immediate, displayed liquidity.
Hitting the offer vs placing one: order types in practice
When you send a buy order that executes immediately at the best offer, traders say you hit or lift the offer. You have accepted the seller’s price and taken liquidity from the book. A market order does this by design, prioritising speed over price control. If there is not enough size at the best offer, the remainder moves up the book to the next offers.
Placing an offer means entering a sell order into the book at a chosen price, often with a limit. A limit order to sell at 101.00 adds visible liquidity at that level and will only execute if buyers are prepared to pay 101.00 or better. If buyers only reach 100.90, your order sits unfilled.
Some details that affect how an offer works once placed:
- Time in force. Day, good‑till‑cancelled and immediate‑or‑cancel instructions change how long your offer waits and whether partial fills are allowed.
- Priority. Most venues use price‑time priority. If many traders offer at 101.00, the one submitted first gets filled first.
- Partial fills. Your offer can be filled in pieces as buyers take size. You might end up selling 300, then 200, then 500 shares at the same price.
The mechanics vary by venue and broker, so the exact behaviour of your order type can differ.
Offer price in IPOs and secondary share sales
When a company sells shares to the public, the sale is set at an offer price. In an IPO or a follow‑on offering, underwriters and the issuer collect investor interest, often within an indicated price range, then set a single price at which the shares are allocated. That is the offer price for the deal. Trading on the exchange typically begins after allocation and can open above or below the offer price depending on demand.
Other capital‑raising structures also use the word. Rights issues, placings and offers for sale each come with an offer price that applies to eligible investors. The terms, eligibility and distribution methods vary by market and provider, and the documentation sets the specifics.
Do not confuse the offer price in a new issue with the live offer on an exchange. One is a fixed price for a primary or secondary sale, set for a defined period, the other is a constantly updating quote for immediate trading.
Corporate actions: takeover and tender offers
In mergers and acquisitions, a bidder may make an offer to buy shares from existing holders. That offer will set out a price per share, the consideration type, any conditions and the timetable. It can be all‑cash, all‑stock or a mix, and it can be conditional on minimum acceptance levels or regulatory approvals.
A tender offer is a similar concept used when a buyer invites shareholders to sell some or all of their shares at a specified price within a given window. Companies also run tender offers to repurchase their own shares. These are formal processes with detailed terms, and rules vary by jurisdiction and can change.
Again, this use of offer has nothing to do with the live ask price on the screen, although news of a bid often pulls the market’s offer closer to the bid price if traders expect the deal to complete.
Similar terms and common pitfalls
- Offer vs ask. In many markets the words are interchangeable. Some data feeds prefer ask, others prefer offer. The meaning is the same: the price at which someone is willing to sell.
- Offer vs offering. Offering tends to refer to the process of selling securities to investors, for example a public offering. Offer is the individual price or proposal.
- Offer size. This is the quantity available at the stated offer price. A tiny size may vanish with a single small trade, while a large size can act like near‑term resistance.
- Spread costs. Buying at the offer and later selling at the bid realises the spread as a cost before fees and taxes. Tighter spreads reduce that cost but do not eliminate it.
- Displayed vs hidden liquidity. The best offer you see might not tell the whole story. Some liquidity is hidden or conditional, and large trades may interact with it in ways not obvious from the top of book.
Across equities, ETFs, bonds, futures and crypto, the offer is always the sell side of the market. Watch it with the bid, the spread and the depth to understand how easy it is to buy, how much it might move the price, and what it could cost to unwind the trade later.