Two-Way Quotation
A price quote showing both the bid and ask prices simultaneously, allowing immediate buy or sell execution.
A two-way quotation shows both the bid you can sell at and the ask you can buy at, simultaneously. Market makers must provide both sides, which is what gives markets immediacy.
A two-way quotation displays both the bid price (at which you can sell) and the ask price (at which you can buy) for a financial instrument at the same time. Market makers are obligated to provide two-way quotes, ensuring there is always a price available on both sides. This two-sided pricing gives liquid markets their immediacy, allowing traders to enter or exit positions instantly.
How It Works
- The market maker posts a bid and an ask simultaneously
- The bid is always lower than the ask. The difference is the spread.
- Traders sell at the bid and buy at the ask. No negotiation on standard quotes.
- In highly liquid markets, two-way quotes update multiple times per second
Trading Tips
A tight two-way quote indicates a liquid market with competition among market makers
A suddenly widening spread signals reduced liquidity or increased uncertainty
Observe two-way quotes during different sessions to see how your broker's spreads behave
Two-Way Quotation Example
Say a market maker streams EUR/USD 1.0850 / 1.0852 all session. You can sell at the first or buy at the second, instantly, all day. Pull one side and arbitrage desks swarm the gap within milliseconds.
How Traders Use Two-Way Quotation
Insist on two-way pricing from any venue holding your money. One-sided quotes hide the true cost. Simultaneous both sides expose it. Compare the width across venues before judging who is cheap.
Related Terms
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