After-hours market

After Hours Trading

The practice of trading a security after an exchange has closed. After-hours trading occurs over-the-counter, but both listed and unlisted securities may be traded. After-hours trading is often less liquid than regular trading because participation by market makers is voluntary, whereas market makers are required to serve as a counterparty for a security during trading hours. The price of a security in after-hours trading may influence is price on the next trading day. The practice is less commonly called extended-hours trading.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

After-hours market.

Securities, such as stocks and bonds, may change hands on organized markets and exchanges after regular business hours, in what is known as the after-hours market.

These electronic transactions explain why a security may open for trading at a different price from the one it closed at the day before.

There's also trading in benchmark indexes such as Standard & Poor's 500 Index (S&P 500) and the Dow Jones Industrial Average (DJIA) before US stock markets open. The level of activity and the direction the trading -- up or down -- is widely interpreted as an early indicator of what's likely to happen in the market during the day.

Dictionary of Financial Terms. Copyright © 2008 Lightbulb Press, Inc. All Rights Reserved.
References in periodicals archive ?
Because the announcement occurs after hours, what is the degree of price adjustment in the first after-hours market session versus the subsequent normal day market?
Schwannecke was introduced to the self-serve concept in 1960 after reading an article about a lumberyard owner in Denver who erected garages on his store sites to capitalize on the after-hours market. Schwannecke flew out to see the operation.
said Wednesday it plans to set up a proprietary trading system in August that will take after-hours market orders from account holders.
will enhance COMTEX's financial news offering with after-hours market commentary and analysis.
Barclay and Hendershott observe two separate trading processes for Nasdaq-listed stocks in the after-hours market: larger less informative trades are negotiated directly with market makers, and smaller more informative trades are executed anonymously on electronic communications networks.
And Instinet, which operates the oldest and most widely-used ECN, recently teamed with on-line brokerage ETrade to allow the latter's retail clients access to Instinet's after-hours market. Securities soared 4,000 yen to 206,000 yen after the online brokerage said earlier in the day it would set up a proprietary trading system in August that will take after-hours market orders from the firm's account holders.
investors were disappointed by the firm's negative earnings outlook for the July-September quarter and its shares traded lower in Tuesday's after-hours markets.