A quote is the price, or pair of prices, that shows where someone is willing to buy and sell an asset right now. In most markets a quote is two sided, with a bid to buy and an offer to sell, each with a size that shows how much is available at those prices.
Quotes are signals of intent. They are not trades. A trade happens only when an order hits a quote and is executed. You will see quotes on screens for shares, ETFs, futures, options, currencies and crypto.
What a quote actually shows: bid, offer, size and spread
The bid is the highest price a buyer is currently quoting. The offer (often called the ask) is the lowest price a seller is quoting. The difference between them is the bid‑offer spread, which is a rough proxy for the cost of trading immediately.
Most screens also show size. That is the number of shares, contracts or units available at each side of the quote. For example: 250.00 bid for 1,500 shares and 250.10 offered for 1,200 shares. If you sell 1,000 shares, you should fill at 250.00. If you buy 1,200 shares, you pay 250.10 for the first 1,200, then the next best offer on the book if you need more.
- Bid: highest standing buy price.
- Offer: lowest standing sell price.
- Size: quantity available at that price.
- Spread: offer minus bid, the headline friction for an immediate trade.
Traders often refer to the mid, which is the simple average of bid and offer. The mid is a reference level used to mark positions, estimate fair value or set limit orders. It is not normally a price you can trade at.
Quote vs last price: why your screen shows two kinds of numbers
Platforms usually display both quotes and the last traded price. It is easy to mix them up. A quote is a standing invitation to trade at a price and size that may change from second to second. The last price is the price at which the most recent trade actually happened, which could be moments or minutes ago.
These can diverge in fast markets. Imagine the last trade was 100.00, but new quotes are 99.80 bid and 99.90 offered. If you place a market buy, you will most likely pay 99.90, not 100.00, because you trade against the current offer, not the historical last price.
Because quotes move, your execution can slip from the price you first saw. The tighter and deeper the quotes, the lower your expected slippage and spread cost.
Where quotes come from: order books and market makers
There are two broad models for how prices are quoted.
- Order‑driven venues: Buyers and sellers place limit orders into an order book. The best buy order sets the bid and the best sell order sets the offer. Trades occur when incoming orders cross the spread or when participants update or cancel their quotes.
- Quote‑driven dealers: A market maker continuously posts two‑way prices and stands ready to transact at those prices up to a quoted size. In some markets dealers quote to all clients on a screen. In others, clients request a price privately and receive a quote back.
Many instruments mix both models. For example, a venue may have a public book during most of the day and run auctions at the open or close that generate indicative quotes before matching. Over the counter, quotes are often provided via a request‑for‑quote workflow rather than a central book.
Firm, indicative and delayed: not every quote is executable
Not all quotes carry the same commitment. A firm quote is executable at the displayed price and size for as long as it is shown, subject to venue or dealer rules. An indicative quote is informational. It signals where the market might be but is not a binding commitment to trade there.
Some screens carry a time label. Real‑time quotes stream instantly. Delayed quotes update after a lag. Many public websites show delayed data by default, with delays that vary by venue and data agreement. If you try to trade off delayed quotes, you may face very different live prices.
Quote quality also depends on depth. A single line quote shows only the best bid and offer. Level‑2 style views show additional layers of prices and sizes behind the top level. Deeper books usually mean more liquidity and less price impact when you trade larger sizes.
How traders use quotes day to day
Quotes are the starting point for most trading decisions. You use them to judge liquidity, set entry and exit levels and estimate trading costs. A few common uses:
- Placing orders: A limit buy might go at or below the bid, while a limit sell sits at or above the offer. A market order aims to execute against the current quote immediately, prioritising speed over price control.
- Measuring spread cost: If the quote is 250.00 to 250.10, buying then instantly selling would cost roughly 0.10 per share, ignoring fees and any movement.
- Estimating fill risk: Size matters. If you need to buy 10,000 shares and see only 1,200 on the offer, you may move the price as you sweep through higher offers.
- Marking P&L: Traders often mark positions off the mid or the last traded price. The choice can change your displayed unrealised P&L when spreads are wide.
Remember that quote conventions and the way orders interact with them vary by broker and venue. Some providers show aggregated quotes from several venues. Others route your order to a single destination. These choices affect your execution and the quotes you see.
Example: reading a live equity quote
Suppose you’re watching a stock with a quote of 1,000.0 bid for 800 shares and 1,001.0 offered for 600 shares. The spread is 1.0. The mid is 1,000.5.
- If you sell 500 shares with an order to execute now, you should trade at 1,000.0.
- If you buy 700 shares immediately, you should trade at 1,001.0.
- If you try to buy 1,200 shares at market, you get 600 at 1,001.0, then climb the book to the next best offer, which could be 1,001.5 for 400 shares, and so on. Your average price ends up above 1,001.0.
If instead you place a limit buy at 1,000.5, you rest between the bid and the offer and might get filled only if a seller joins you or the offer moves down.
FX and crypto quoting quirks
Currency pairs and many crypto pairs are quoted to multiple decimal places, and often in standard pip increments for FX or ticks for futures. In foreign exchange the pair structure matters. The first currency is the base, the second is the quote currency. A EUR/USD quote of 1.0950 to 1.0952 means you need about 1.0952 US dollars to buy one euro at the offer, or you receive 1.0950 dollars if you sell one euro at the bid.
Crypto venues often show aggregated quotes from multiple market participants on a central book. Liquidity can vary by time of day and by trading pair, which affects spreads and the reliability of displayed sizes. As with other markets, quotes can widen during news, around auctions or when large orders hit the book.
Common confusions and pitfalls
- Quote vs price: The last trade is not the same as the current quote. Trade against the quote you see, not the last print.
- Small print: Indicative, stale or delayed quotes look real but may not be tradable. Check the label and the time stamp.
- Size illusions: Some participants refresh small displayed sizes rapidly. Visible size is not always a full guide to true liquidity.
- Widening spreads: Spreads can gap wider in volatile or illiquid periods, increasing your implicit cost to enter or exit.
Understanding what a quote represents, who is posting it and how your order will interact with it makes the difference between a clean fill and a costly surprise.