How markets work
Market hours
Also called Regular trading hours
The window in which an exchange’s main continuous trading session runs.
How it works
Each exchange has its own hours in its own time zone, plus a calendar of holidays and occasional half-days. Outside those hours, orders queue rather than execute.
Many markets also run pre-market and after-hours sessions with far less liquidity, wider spreads and different rules. Prices there can move violently on small volume and often do not hold when the main session opens.
Where it misleads people
An after-hours price is a real trade but a thin one. Judging a company’s reaction to results from a few after-hours prints frequently gets the direction of the next day wrong.
Related terms
- After-hours tradingTrading that happens outside an exchange’s regular session, in a much thinner market.
- AuctionA short period where orders are collected and matched at a single price, rather than continuously.
- ExchangeA regulated marketplace where buyers and sellers of securities are matched under published rules.
- GapA jump between one session’s close and the next session’s open, with no trading in between.
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