An Order Book is a list of buy and sell orders for a stock, ETF, or other financial asset. It shows how many investors want to buy or sell an asset and at what price. Financial exchanges use the order book to match buyers with sellers and determine market prices.

The order book consists of two sides: bids (buy orders) and asks (sell orders). The highest bid and the lowest ask help define the current market price. A large number of orders can indicate strong liquidity, while a small number of orders may lead to larger price fluctuations.

For long-term investors, understanding the order book can help explain how trades are executed and why prices move throughout the trading day. However, it is generally more important for active traders than for passive ETF investors.