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Bid-To-Cover Ratio is a ratio used to measure the demand for a particular security during offerings and auctions. In general, it is used for shares, bonds, and other securities. It may be computed in two ways: either the number of bids received divided by the number of bids accepted, or the value of bids received divided by the value of bids accepted.
The higher the ratio, the higher the demand. A ratio above 2.0 indicates a successful auction with aggressive bids. A lower reading indicates weak demand and is said to have a long tail.
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