A clean quantitative framing is this: the bid-ask spread is a market maker's compensation for providing immediacy. Mechanism: Spreads are wider when uncertainty is high, when the asset is illiquid, or when the market maker suspects adverse selection. Why it matters: Understanding spread dynamics helps you time executions and choose between aggressive and patient order types. Market translation: Right before earnings, spreads on single-name options widen because the market maker is uncertain about the magnitude of the move. Failure mode: The mistake is crossing the spread aggressively on every trade without considering whether the urgency is real. Review question: Write down the state variable you would monitor first if this thesis started to drift. A lot of confusion disappears once you separate the headline from the mechanism.