Level 1: Definition, How It Works, and Accessibility

Level 1 is a basic market data feed that shows the national best bid and offer (NBBO) for a security in real time. It displays the best available bid and ask prices and the size (volume) at those prices. Level 1 provides the essential price information most retail investors need to monitor and trade stocks.

Key takeaways

• Level 1 shows the best bid and best ask (plus size) for a security — the NBBO in real time.
• It is sufficient for long-term and many retail investors who don’t need detailed order-book information.
• Level 2 and Level 3 add market depth and order-entry capabilities for active traders, market makers, and brokers.
• Level 1 quotes are widely available and often provided for free by brokers and financial websites.
• Reliable Level 1 data helps decide whether to use market orders or limit orders, especially in fast-moving markets.

What Level 1 shows

Level 1 quotes include:
* Best bid price and size (highest price a buyer is willing to pay and how many shares)
* Best ask price and size (lowest price a seller is willing to accept and how many shares)
* The most recent trade price (depending on feed)

This information reflects the top of the order book across exchanges and represents the best immediate prices a trader can access.

How traders use Level 1

• Long-term investors use Level 1 to monitor price movements and execute trades without needing deeper order-book detail.
• When placing orders, Level 1 helps determine whether to place a market order (accept current best price) or a limit order (specify worst acceptable price).
• In fast or thinly traded markets, Level 1 can indicate whether an order of a given size is likely to fill at the displayed price or may move the price.

Example: If the Level 1 quote shows a $5.00 last price with a $5.10 ask for 100 shares and a $4.90 bid for 500 shares, a buyer considering a $1,000 purchase can use that information to estimate execution risk and whether to use a limit order to avoid slippage.

Differences between quote levels

• Level 1 — Best bid and best ask with sizes (NBBO). Suitable for most retail investors.
• Level 2 — Adds market depth: multiple best bid and ask prices (typically 5–10 levels) and the identities of market makers or exchange participants. Useful for active traders who need insight into order flow and depth.
• Level 3 — Includes Level 1 and 2 data plus the ability to enter, update, and cancel orders directly on the exchange. Reserved for registered brokers and market makers.

All three build on each other: Level 1 is the top-of-book view, Level 2 shows the near-term depth of liquidity, and Level 3 supports active quote management and order routing.

Where to get Level 1 data

Level 1 quotes are widely available and often free:
* Brokerage platforms and trading apps
* Financial portals and news sites
* Directly from exchanges or via data vendors

While free feeds are common for retail users, professional or low-latency traders may pay for faster or more comprehensive data services.

When Level 1 is enough — and when it’s not

Level 1 is usually adequate for:
* Long-term investors
* Occasional traders who want current best prices

Level 1 may be insufficient for:
* High-frequency or active traders seeking small, frequent gains
* Traders executing large orders that could move the market
* Participants who need to analyze order-book dynamics and visible liquidity across price levels

In those cases, Level 2 or Level 3 data can provide the additional granularity needed to assess support, resistance, and potential short-term price movements.

Summary

Level 1 provides the real-time best bid and ask with size (the NBBO) and is the standard market snapshot used by most individual investors. It is widely accessible and usually sufficient for ordinary trading needs. Active traders and market participants requiring deeper insight into order flow and the ability to manage quotes will rely on Level 2 or Level 3 data.