Dictionary / Trading and orders
What Is After-Hours Trading?
After-hours trading is buying and selling stocks after the normal market closes. Pre-market trading is the same idea before the market opens.
The hours
Normal US market hours are 9:30 a.m. to 4 p.m. Eastern time. After-hours trading usually runs from 4 p.m. to 8 p.m., and pre-market from early morning until 9:30 a.m. Exact times depend on your broker.
Why prices move after hours
Many companies release their earnings reports just after the close. That is why you often see big after-hours jumps or drops on earnings days.
The risks
- Fewer traders means lower liquidity.
- Wider bid-ask spreads.
- Bigger, jumpier price moves.
- Brokers often accept only limit orders outside normal hours.
See it in real companies
Open a company to see what it sells and how it makes money.
Related terms
Earnings reportA company's report card, every three months.
LiquidityHow easily you can buy or sell without moving the price.
Bid-ask spreadThe gap between buying and selling prices.
Market vs limit orderBuy now at any price, or only at your price.
VolatilityHow much and how fast a price moves.
Day tradingBuying and selling within the same day.