1. Bid price and ask price

Bid price and ask price are two important concepts in trading and financial markets.

The bid price is the highest price a buyer is willing to pay for a particular asset or security at a given point in time. It is the price at which a buyer is willing to purchase a security. For example, if the bid price for a stock is INR 100, it means that a buyer is willing to buy the stock for INR 100.

Ask price, on the other hand, is the lowest price at which a seller is willing to sell a particular asset or security at a given point in time. It is the price at which a seller is willing to sell a security. For example, if the ask price for a stock is INR 110, it means that a seller is willing to sell the stock for INR 110.

The difference between the bid price and the ask price is known as the bid-ask spread.

Bid price and ask price are constantly changing in real time in response to market conditions and the forces of supply and demand. As buyers and sellers enter or exit the market, the bid-ask spread can widen or narrow, affecting the price at which securities are bought and sold.

2. Market orders, limit orders, and day orders

Market orders, limit orders, and day orders are types of orders that traders can use to buy or sell securities in financial markets.

A market order is an order to buy or sell a security at the best available price in the market at the time the order is placed. It guarantees execution but does not guarantee a specific price. This means that the price at which the order is executed may not be the same as the current market price. Market orders are typically used when the trader wants to execute the order quickly, without regard for the price.

A limit order is an order to buy or sell a security at a specific price or better. It ensures that the trader will not pay more (in the case of a buy order) or receive less (in the case of a sell order) than the limit price. The order will only be executed if the market price reaches or exceeds the limit price. Limit orders can help traders avoid overpaying or underselling security, but there is a risk that the order may not be executed if the market price does not reach the limit price.

A day order is an order that is valid only for the trading day on which it is placed. If the order is not executed by the end of the trading day, it will expire and will need to be re-entered if the trader still wishes to buy or sell the security.

In summary, a market order guarantees execution but does not guarantee a specific price, a limit order guarantees a specific price or better but may not be executed, and a day order is valid only for the current trading day.