The amount that an entity or broadly a market participant is willing to pay as a consideration for purchasing an asset (a commodity, security, or contract) in the market. It is the highest price a buyer is willing to pay for an asset.

The bid price is typically set against the other leg of a two-way cost quotation (bid-ask spread) which portrays all the expected costs at which an asset can be purchased and sold at a given time. The ask price represents the base value that a seller is willing to get for that asset (or its equivalent). The bid price reflects the highest amount/ value that a purchaser will pay for that asset. An exchange, transaction, or trade takes place when a market participant is willing to buy at the best offer or sell at the best bid.