Bid, ask, mid and mark
The bid is what a buyer will pay you right now. The ask is what a seller wants. The mid is the average of the two and nobody is obliged to trade there. Your broker also shows a mark, which is its own estimate of fair value and is what your account statement uses. Four numbers, and only two of them are real.
Options spreads are wide compared to stock. A penny-wide market on a $38 stock is nothing. A nickel-wide market on a 35 cent option is a seventh of the trade, gone before it starts.
The four prices
DKNG September 19 $43 call: $0.49 bid, $0.53 ask.
- Bid, $0.49. Sell to that right now and you get $49. Guaranteed, immediate, and the worst price available.
- Ask, $0.53. What you would pay to buy it. Irrelevant when you are opening a short, and very relevant when you close one.
- Mid, $0.51. The average. Every calculator on this site uses it, every screenshot quotes it, and it is not an offer from anybody.
- Mark. Your broker's fair-value estimate, usually the mid or something near it. This is what values your position overnight and what your unrealized profit and loss is computed from. It is an accounting number.
Plan with the bid. Hope for the mid. Never plan with the mark.
What the spread costs, as a percentage
The same nickel is a completely different tax depending on where you sell it.
| Contract | Bid | Ask | Mid | Spread | Spread as % of mid |
|---|---|---|---|---|---|
| $40 call | $1.35 | $1.41 | $1.38 | $0.06 | 4.3% |
| $42 call | $0.71 | $0.76 | $0.73 | $0.05 | 6.8% |
| $43 call | $0.49 | $0.53 | $0.51 | $0.04 | 7.8% |
| $44 call | $0.33 | $0.38 | $0.35 | $0.05 | 14.3% |
Selling the $44 call at the bid instead of the mid gives up 2 cents on a 35 cent option. Two dollars, which sounds like nothing. Do it eight times a year and it is $16 against $280 of premium collected, which is 5.7 percent of the year's income handed over for the convenience of not waiting. The full annual arithmetic is on its own page and the number is bigger than people expect.
This is also why the far strikes are worse than the delta suggests. Cheap options have wide spreads in percentage terms, so the strike that already pays too little pays even less after you actually trade it.
Working the order
Do not send a market order on an option. Ever. Options markets are thin enough that a market order on a quiet strike can fill somewhere you would not have agreed to.
What works, on a normal liquid chain:
Start at the mid. Limit sell the $43 call at $0.51. On a liquid name in the middle of the session this fills more often than not, because market makers would rather take the trade than let you walk.
Give it a few minutes. Not a few seconds. The order has to be seen.
Then step down one tick. $0.50. Then $0.49 if you have to. Each step is a penny, which is $1 per contract, and it is worth knowing your walk-away price before you start rather than discovering it while you are annoyed.
Decide the floor first. If the trade only works at $0.51 and the market will not come to you, that is information: the premium was not there. Cancel it. The fill page covers what the distance from the mid does to your odds, and the honest finding there is that no source worth quoting publishes a curve for it.
When the spread tells you to walk
A wide spread is not just a cost. It is a signal about who else is here.
$0.33 bid at $0.38 ask on the $44 call, with 12 contracts traded today and 640 open. That is a strike with a market maker quoting because they have to and nobody else in the book. You can trade it. You will get the bid, you will pay the same spread again to close, and if the position goes wrong there may be no bid worth hitting at all.
Rough rule for a premium seller: if the spread is more than about 10 percent of the mid, the strike is not liquid enough and the trade needs to be somewhere else. That single test throws out most of the bad fills before they happen, and a proper liquidity screen formalises it with volume and open interest thresholds alongside.
Closing costs the same spread again
The part that gets forgotten. Sell the $43 call for $0.49 and later buy it back at $0.10, and you have crossed the spread twice. On a contract you opened for $49 that round trip cost you the difference between $0.49 and $0.51 going out and between $0.10 and $0.08 coming back, so 4 cents of the 39 cents you actually made. Ten percent.
Which is a quiet argument for letting cheap contracts expire rather than closing them, and a loud one against any management rule that has you trading in and out repeatedly on small credits.
OptionsKing scores every candidate strike on a deterministic 0 to 100 scale, blends that score with the return on the capital the trade ties up, and shows you the highest-ranked handful. There is no minimum score. How it works covers what the ranking does and does not tell you.
Questions people actually ask
Should I use the bid or the mid when planning an option trade?
Plan with the bid, because that is the price you are guaranteed. Work the order at the mid and step down from there. The difference on a 35 cent option is about 6 percent of the trade.
What is the mark price on an options position?
Your broker's own fair-value estimate, usually at or near the mid, used to value your account and compute unrealized profit and loss. It is an accounting number and no one has to trade with you at it.
How wide is too wide a bid-ask spread on an option?
More than roughly 10 percent of the mid and the strike is not liquid enough to be worth selling. On the worked chain the $44 call is a nickel wide on a 35 cent option, which is 14.3 percent, and only twelve contracts traded there all day.
Should I use a market order for options?
No. Options books are thin enough that a market order on a quiet strike can fill at a price you would never have agreed to. Use a limit, start at the mid, and know your walk-away price before you send it.
Sources
Rules and thresholds above were checked against these documents on August 4, 2026. Exchange and broker rules change. Confirm anything you are about to act on with your own broker.
Keep reading
Do the math on your own trade
Every price in this article is an illustrative worked example, not a quote. Read Options basics for the rest of the series, and the disclaimer before you act on any of it. Selling options carries real risk of loss, and the loss can be far larger than the premium you collected.