Jump to content
House Price Crash Forum
Sign in to follow this  
poorman

Wide Speard

Recommended Posts

I have noticed some shares on AIM & SMALL CAP have a very wide SPREAD (about 50%) & some are only (about 2%)especially on 10-20p shares . Can anyone explain to me exactly what causes this, or or is it a combination of things. ;)

Share this post


Link to post
Share on other sites

popularity and the qty of trades, the more efficient a market the smaller the gap. If you have 1 shop in a street selling apples they will rip you off with a big spread, if you have millions of apple shops selling the same apples you get a better price and the spread between buying and selling will be smaller

Edited by moosetea

Share this post


Link to post
Share on other sites

Thanks for that moosetea that's a lot clearer, I always only buy narrow spread shares, so I can sell quick If the price drops steeply without losing,I have noticed they also tend to go down far more quickly than they rise. (I have been caught out few times) :(

Share this post


Link to post
Share on other sites
Thanks for that moosetea that's a lot clearer, I always only buy narrow spread shares, so I can sell quick If the price drops steeply without losing,I have noticed they also tend to go down far more quickly than they rise. (I have been caught out few times) :(

Don't trade. Very few are successful.

Share this post


Link to post
Share on other sites

one other thing, remember it is a market, with buyers and sellers and people in the middle getting the buyers to buy from the sellers, and vice versa, the price is made up of the average of thousands of little trades... If the price moves, it means the sellers don't want to sell at that price the spread naturally widens until a buyer takes the price. If you think of a market as a line on a graph your asking for trouble.

Share this post


Link to post
Share on other sites
one other thing, remember it is a market, with buyers and sellers and people in the middle getting the buyers to buy from the sellers, and vice versa, the price is made up of the average of thousands of little trades... If the price moves, it means the sellers don't want to sell at that price the spread naturally widens until a buyer takes the price. If you think of a market as a line on a graph your asking for trouble.

So basically the MM's don't want your shares hence the massive spreads <_<

Thanks again

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 355 The Prime Minister stated that there were three Brexit options available to the UK:

    1. 1. Which of the Prime Minister's options would you choose?


      • Leave with the negotiated deal
      • Remain
      • Leave with no deal



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.