after-hours trading

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.

after-hours trading

The trading of securities after the exchanges are closed. After-hours trading often refers to trading a listed security in the over-the-counter market after the exchanges have been closed for the day. This fairly common practice is not illegal. Also called extended-hours trading.
Case Study Research indicates individual investors trading outside normal market hours (9:30 a.m. to 4:00 p.m. EST) can expect to incur increased transaction expenses. The higher expense of after-hours trading stems from reduced liquidity and the resulting larger spreads between bid and ask quotations. For example, a stock that typically trades with a spread of 5¢ to 10¢ during regular market hours might have a spread of 25¢ to 50¢, or even more, in after-hours trading. Actively traded stocks during regular hours often become relatively illiquid in after-hours trading, when few orders are posted and even small transactions can result in large price fluctuations. The potential volatility and lack of liquidity in after-hours trading are likely to result in individual investors paying too high a price when buying stock and receiving too low a price when selling stock.
References in periodicals archive ?
Lululemon shares rose 1.2% to $182.88 in after-hours trading.
The results beat Wall Street estimates and shares gained 3.5% to $216.10 in after-hours trading.
The stock in after-hours trading is down 21c to $23.20.
The stock held on to gains it made in after-hours trading following Tuesday's announcement that the Silicon Valley firm delivered 95,200 cars, sending shares up as much as 7.6 per cent to $239.68 yesterday.
Despite the positive results, which beat analysts' expectations, the company's shares sank further into negative territory in after-hours trading. The stock closed regular trading in New York down 0.1% and fell a further 0.3% in the after-hours session.
-- Shares of FedEx fell in after-hours trading after the package-delivery giant reported lower profit.
In early after-hours trading on Friday, another 8 cents was tacked on to that price.
The company exceeded analyst expectations in per-share earnings and revenues, lifting shares in after-hours trading.
The After-hours Trading Session (T+1 Session), an additional derivatives trading session introduced by Hong Kong Exchanges and Clearing Limited (HKEX) in April 2013, has proved to be effective and useful to market participants as it marks its fifth anniversary.
Jeff Bezos's fortune struck an all-time in after-hours trading Tuesday after Amazon.com, Inc.
The exchange took home the 'Global Exchange of the Year' at FOW in December 2017, becoming the first regional market to scoop the award after years of impressive growth and innovation, including the launch of the world's first offshore RMB options, two RMB futures contracts (USD/CNT and USD/CNH FX futures), Nifty futures and Taiwanese dollar denominated S and P and DJIA futures, and an after-hours trading session to boost capacity and cut latency.
Shares in the online marketplace for babysitters, caregivers and pet sitters have soared more than 40 percent in after-hours trading after it was revealed that Google had invested $46.35 million in the company to become the majority shareholder.