Extended-hours trading takes place before the market opens and after it closes. In the U.S., pre-market trading generally runs from about 4:00 a.m. to 9:30 a.m. ET, and after-hours trading typically runs from 4:00 p.m. to 8:00 p.m. ET. These sessions allow investors to react to news, earnings results, or global market events that happen outside the normal trading day.
Trading during these periods works differently because fewer participants are active. Lower liquidity often leads to wider spreads and faster price swings. Some brokers limit which order types can be used, and not all stocks trade actively during these sessions. As a result, prices in extended hours may be less stable and may not fully reflect the levels seen when the main market opens.
Extended-hours trading is popular among active traders, investors reacting to earnings announcements, and global traders who need to respond to events in other time zones. However, it requires caution, awareness of risks, and an understanding of how prices behave when volume is low.
Extended-hours trading lets investors react more quickly to important news, but it also introduces higher volatility, wider spreads, and different execution rules.
There are fewer buyers and sellers active before the market opens and after it closes. With limited competition for orders, even small trades can move prices significantly. News released outside market hours—like earnings or economic reports—also triggers sharp reactions. Together, these factors create an environment where price swings are more common and less predictable.
Many brokers restrict certain order types, allowing only limit orders to protect traders from unexpected price moves. Orders are routed through alternative trading systems (ATSs) rather than the main exchanges. Execution may take longer, and orders may remain unfilled if there isn’t enough liquidity. Traders must understand their broker’s specific rules before participating.
Investors face wider bid–ask spreads, lower liquidity, and a higher chance of slippage. Market reactions may be exaggerated due to fewer participants, and prices can change quickly once the main session opens. It’s important to use limit orders, follow news closely, and be aware that extended-hours prices may not reflect the levels seen during the regular session.
A company reports earnings at 4:05 p.m. ET, just after the closing bell. The stock jumps sharply in after-hours trading as investors react to the results. The next morning, when regular trading resumes, the price adjusts again as more traders enter the market.
FinFeedAPI’s Stock API provides pre-market and after-hours price data for many exchanges, helping users track how stocks move outside the regular session and analyze reactions to earnings or news events.
