After-hours trading refers to the buying and selling of securities completed outside of regular trading hours. Trading outside of the standard trading hours of 9: Eastern Standard Time uses electronic communication networks ECNs to match potential buyers and sellers without using a stock exchange. The emergence of electronic communication networks ECNs ushered in a new era in stock trading. An ECN is an interface that not only allows individual investors to interact electronically, but also lets large institutional investors interact anonymously, thereby hiding their actions.

After-hours trading was used primarily by institutional investors up until the s when ECNs became more widely available.

The after-hours market close is the last transaction and final price of a security that is traded in the after-hours market. The morning after-hours trading hours run from approximately 8: The afternoon after-hours session extends from 4: Certain pre-market trading takes place as early as 6: For traders, there are several advantages to trading after regular market hours.

Investors may prefer trading at off-peak times, and after-hours trading provides this added flexibility. Many significant news events, such as earnings releases and economic indicators, are released outside of standard trading hours. The after-hours trading sessions are opportunities to trade immediately on new information rather than waiting for the traditional trading day to take a position.

Furthermore, although volatility is a risk associated with trading after hours, you may find some appealing prices during xe exchange rates table time.

Company earnings or news releases after the bell draw big attention and create both volume and volatility as traders react to the news. The calendar, therefore, provides a list of stocks to watch after hours for an opportunity. Note the stocks during the day, and narrow the list to a most volatile stocks options more manageable selection of stocks to trade. Do this by filtering out those with an average daily volume less than 1 million shares.

If the shares don't have significant volume during the regular trading session—9: EST—then it is unlikely to have significant volume after the closing bell, even with a major news release. The development of after-hours trading offers investors the possibility of significant gains, dr gary dayton trading psychology edge you should also be aware of some of its inherent risks and dangers:.

However, in the late-day trading of mutual funds, the price of the mutual free forex arbitrage ea NAV remains constant after a certain time of day because no one else is allowed to buy and sell it until the next day. This constant price is sometimes referred to as a stale quote because, late in the day, the price is no longer live and will not change.

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So, if any material information affecting the fund becomes public after the fund's price is set, an opportunity is created for traders to capitalize on the stale quote price: This practice is unfair because it is done at a time when other investors are not participating in buying and selling the fund, so the late-day traders are exclusively trading at prices that are momentarily suspended and not reflecting the changes in the fund's "actual" worth—if other investors were allowed to trade the fund, the price would be affected by the market forces in real time, and no one person would have an advantage.

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