Trading, Accounts & Prohibited ActsQuestion 220 of 398
A dealer quotes stock XYZ at $15.20 - $15.35. At what price would a customer's market order to sell be executed?
a.$15.35, the ask price
b.$15.20, the bid price
c.$15.275, the midpoint
d.$30.55, the sum of the quotes
Explanation
A customer sells at the dealer's bid, which is the lower quote of $15.20, and buys at the dealer's ask of $15.35. The dealer captures the $0.15 spread as compensation.
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