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The difference between two related prices, rates, or yields, most commonly the bid-ask spread (the gap between what buyers will pay and sellers will accept).
The bid-ask spread is the cost of immediacy in financial markets. Highly liquid stocks like Apple may have spreads of just $0.01, while illiquid small-cap stocks might have spreads of $0.10 or more. Wider spreads mean higher transaction costs for investors. In fixed income, the credit spread is the yield difference between a corporate bond and a comparable Treasury bond, reflecting the additional risk. For example, if a 10-year Treasury yields 4% and a BBB-rated corporate bond yields 5.5%, the credit spread is 150 basis points. Spreads widen during economic stress and narrow during periods of confidence.