The highest price a buyer pays right now. You receive it when you sell the option.
What this price is
The Bid (Bid) is the highest price buyers are offering right now for a contract. It is the price you get if you sell immediately to exit. Its counterpart is the Ask (Ask): the lowest price sellers accept, which is what you pay to enter immediately. The distance between them is the Spread.
Why it matters to you
Every immediate trade pays about half the spread as an entry toll, and the same again on the way out. In liquid contracts the spread is a cent or two and goes unnoticed. In thin contracts it runs to tens of cents, so the trade starts with a sizable loss before the stock moves.
Reading the spread is reading liquidity
A tight spread is the most honest measure of how alive a contract is. It is tightest at the money, in near expirations and in the large symbols, and widens as you move away from those. A sudden widening during the session signals stress by itself, because market makers cut their commitment around events and auctions.
Hypothetical example
A contract with a bid of $1.00 and an ask of $1.10: an immediate buy followed by an immediate sell loses 10% without anything moving. Another contract with a bid of $1.04 and an ask of $1.06: the same round trip costs only 2%.
Common mistake
Sending market orders in thinly spread contracts. A market order eats the whole spread and sometimes more. A limit order near the middle of the spread is the norm for options.
Why depth is measured with it
The displayed price does not say how many shares can be sold at it. Book depth decides how your order moves the price. An attractive price on thin depth slips as soon as you press, and that is the gap between the quoted price and the executed price.
Where to see it on the platform
The option chain shows the bid and ask for every contract, and the auction alert in the Treasury tools flags the minutes when spreads usually widen.
The option chain shows spreads and sizes, and the scanners rank by actual liquidity.
