After-Hours Trading
Stock trading that occurs after the official 4:00 PM ET close. Lower liquidity and wider spreads; major news like earnings often hits here.
After-hours trading takes place between 4:00 PM and 8:00 PM ET via electronic communication networks (ECNs). It allows traders to react to earnings releases, news events, and economic data that hit after the regular session closes.
Volume is a fraction of regular-session volume, which means liquidity is thin. A modest trade can move the price dramatically in after-hours, creating wide bid-ask spreads and exaggerated price swings that do not always hold when the regular session opens.
After-hours prices are not necessarily where the stock opens next morning. Gaps, reversals, and further news can all intervene between the after-hours reaction and the official open.
Related Terms
Earnings Gap
The overnight price jump or drop a stock makes between the prior close and the open after an earnings report.
IntermediateEarnings Report
A company's official quarterly disclosure of revenue, earnings, margins, and guidance. The biggest recurring event in single-stock trading.
BeginnerHalt (LULD)
A mandatory pause in trading when a stock's price moves too far, too fast. LULD bands are set as a percentage of the prior reference price.
AdvancedMarket Maker (Equities)
A firm or individual that continuously quotes buy and sell prices for a stock, providing liquidity and enabling smooth trading.
AdvancedMarket-on-Close (MOC) Order
A market order that executes in the official closing auction at the day's closing price. Used to guarantee a close print; large MOC imbalances can move price into the bell.
IntermediatePre-Market Trading
Trading before the 9:30 AM ET open, typically from 4:00 AM to 9:30 AM ET. Used to react to overnight news, data, and earnings.
Intermediate