## Understanding the Bid-Ask Spread: The Hidden Cost in Your Trades
**What's Really Happening When You Trade?**
Every time you place a buy or sell order on an exchange, there's a gap between what buyers are willing to pay and what sellers are asking for. This difference is called the bid-ask spread, and it directly affects your trading profitability.
**How the Spread Gets Created**
The bid-ask spread emerges through two primary mechanisms. In traditional finance, brokers intentionally create this gap as their main revenue stream—they buy assets at lower prices from sellers, then turn around an