If you trade for a bank, do you pay the spread?

Or do you have the ability to buy on the bid and sell on the ask?

Thanks!

if you are a marketmaker for the bank, then no, you dont pay the spread. you are paid the spread. that is your reward for making the market.

Hi

A Bank Trader "gives" bids /"takes" offers just like anyone does.
They also "quote" their bids/offers to other Banks/customers/input in EBS etc for people to hit their prices.

Only if you get given a "choice" price

When I was quoting Interbank I have had some Banks turn down a Choice price - a cardinal sin in the Trading World

I understand that if you are making the market you buy on the bid and sell on the ask, but I am not interested being an order taker.

I wanted to know if I was a trader for a bank trading my own strategy and only bought and sold when I wanted to if I could still buy the bid and sell the ask.

if you buy on the bid and sell on the ask, you are by definition a market maker. so if you are not a market maker, you will not buy on bid.

NO...You have to buy/sell with another counterparty, therefore you will be giving/selling at the counterparty's bid price and taking/buying at their offer price.
If the counterparty let everyone buy at his bid, and sell him at his offer he wont be in business very long

what some banks allow is for you to offer at the ask so: if eurusd is 26/28 you can offer to sell 1 at 28....however you are not guarenteed a fill as the market must tick to 28 for you to be taken short at 28...or the person executing your trades (computor or human) will see a bid at 28 and match you to it without showing that the market went to 28...the match happened in the background so it will sometimes feel like you can sell at the ask...

hope this helped

What is a "Choice price"? and why is it a sin?

A "choice" price is where you quote another Bank the same price ie no spread eg... 1.8975 choice
They can buy or sell at that price.

Eg....If GBP is usually quoted as 2 pips ....1.8974/76, and I quote 1.8975 choice theyre getting a bid/offer better than the "market" price ....Its a "sin" to not deal on a choice price because as theyve asked me for a price how can they not deal on a price "better than the market"....What do they want?... A price "outside the market"

I guess it is(was?) a "Gentlemens Agreement" amongst (some!) Bank Traders not to turn down a choice price.