What is a yellow strip?
This highlights the best bid or ask price available through the London Stock Exchange (LSE) trading system for a particular stock. A yellow strip is displayed on trading screens and acts as a useful benchmark for pricing shares.
Where have you heard about yellow strips?
The strip is clearly visible on traders’ screens. One column shows the bid prices, while another shows the ask prices, with the best quotes shown at the top. The bid price is the price at which traders are offering to buy, while the ask, or offer, price is the price at which they’re willing to sell.
What you need to know about yellow strips.
Orders placed by large institutional investors such as pension funds and insurance companies often go directly through the electronic trading system that matches buyers with sellers.
There will usually be a number of different bid and ask prices posted on the LSE's system, which is known as the order book. The highest bid price and lowest ask price will be highlighted with a yellow strip. The difference between the lowest offer and highest bid is known as the bid-ask spread.
Find out more about yellow strips.
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