Core terms
National best bid and offer (NBBO)
The highest displayed bid and the lowest displayed offer across US exchanges' quotations for a stock, calculated and published continuously by the consolidated market data processors.
US stocks trade on many exchanges and off-exchange venues at once. The NBBO combines the exchanges' displayed quotes into one best bid and one best offer. Brokers use it as the benchmark for execution quality, and Regulation NMS generally prohibits trading through better displayed prices on other exchanges.
The NBBO is built from displayed quotes in round lots. Odd-lot orders, hidden orders and off-exchange liquidity can offer better prices that the NBBO does not show.
What traders should verify
When a fill looks off, compare it with the NBBO at that moment, not with the last trade price.
Do not conflate
Your platform's quote may come from a single exchange or a direct feed and can briefly differ from the consolidated NBBO.