when completing a purchase at the bid price both the bid and the ask may rise to significantly higher levels for subsequent transactions if the seller perceives a strong demand 
market makersmarket makers who are often referred to as specialists are vital to the efficiency and liquidity of the marketplace by quoting both bid and ask prices they step into the stock market when electronic price matching fails which enables investors to buy or sell a security although specialists must always quote a price for a stock they trade there is no restriction on the bid ask spread in the foreign exchange market interbank traders function as market makers because they provide a continuous stream of two way prices to both direct counterparties and the electronic trading systems their spreads widen during times of market volatility and uncertainty and unlike their counterparts in the stock market they are not required to make a price in low liquidity markets other types of bidsthere is more than one way to make a bid as mentioned above the different types of bids depend on where the offer is being made some of the most common types of bids are listed below auctions are forums that bring together multiple buyers who compete for certain assets such as livestock home goods properties property tax liens and art these venues are usually held in person but the rise in technology has made online auctions a reality buyers who participate in auctions bid against each other in order to win the asset through an open bidding process they do so by placing competitive bids in an attempt to beat out the other buyers the person who bids the highest amount wins the auction online bidding sites work just like traditional auctions sites like ebay and ebid allow buyers to congregate in a virtual arena and make bids for products and services of their choosing for instance someone may be selling a pair of designer sunglasses on ebay and starts an auction with a minimum price interested buyers can bid on the item with an amount they wish to pay until one person s bid is accepted by the seller these sites normally require buyers to set up accounts and may also require payment card information unlike the two types of bids noted above participants in some venues aren t privy to how much their competitors are bidding this is the case with sealed bid auctions a sealed bid auction happens when multiple bidders are given envelopes in which they place their bids the envelopes are then sealed so no one bidder can knowingly outbid the other making the outcome fair the highest bidder is the one who wins this type of bidding normally takes place for contracts or real estate sales make sure you don t go over your maximum amount when you re bidding at an auction examples of a bidlet s take a look at how the bidding process works using two examples sotheby s is one of the world s largest marketplaces for art and luxury goods that operates in 40 countries it caters to 70 different categories including jewelry contemporary art and wine and spirits the organization holds hundreds of auctions each year in person online and through private sales it hosted 529 in 2023 and expects hundreds more in 2024 45a winning bid of 2 68 million landed a buyer an unmounted diamond weighing 50 03 carats on june 17 2021 6 a collection of artwork owned by real estate mogul harry macklowe and his ex wife raised a total of 922 million in 2022 making it the most valuable collection sold through the auction company 7jeff bezos the founder of amazon auctioned off a seat on his spaceship in june 2021 through a month long bidding process the auction which took place live over the phone ended on june 12 2021 the undisclosed winner bid 28 million in order to secure a place on the blue origin with bezos for a sightseeing tour on july 20 2021 from west texas 8