How does after hour trading work?
In: Economics
The markets never actually ‘close’ per se after hours, like a store would close its doors and locking up. The store is always open. However, after normal hours, there aren’t many customers or sales, almost everyone goes home for a the night, so there isn’t a lot happening, they also only may let certain people in after hours in the store. Technically anyone can get it, but it can be a bit harder to deal with getting into the store after hours.
But for practical purposes, if you can trade after hours, its no different than trading during normal hours, there is just a lot less people trading then, which can make actually making a trade harder.
So typically there are a number of big trading platforms called electronic communication networks that then communicate with each other via the stock exchanges, so anybody can trade with anybody and maximum efficiency is achieved during main trading hours. During after hours trading, you’re basically limited to trades among others using the same electronic communication network to execute trades. This means your trade on E-Trade might only be traded among other E-Trade customers and whatever other brokerages use the same ECN as E-Trade.
[removed]
There is nothing really ‘different’ about after hours trading. If you get access to it, there are people listing their stocks to sell and there are people there to buy them. That’s basically it.
The ‘normal’ stock trading hours 9:30 to 4 pm. Generally this just came from tradition where actual people were involved.
There is still a bit of that today. Computers may run 24/7, but they still need support staff. Generally ‘off-hours’ allow fewer people to be on staff, system maintenance, financial calculations and everything to be done…
For this reason, the markets tend to want to keep most trading to the core hours. If you get access to it outside of those hours, there will just be a smaller group of people trading, more volatility…
Outside of that, it’s basically the same thing.
Your trade never hits a lit market in after hours much less during normal trading hours. Visit r/superstonk for more info.
There are people fighting this battle daily. Retail has no movement in the price of a stock. They internalize everything and your trade goes to a dark pool.
Ken Griffin of Citadel is a criminal and needs to be behind bars
Latest Answers