premarket

Premarket trading refers to trading activity in financial markets that occurs before the regular market session opens. It allows investors to react to overnight news, earnings releases, or other events that could affect prices at the start of the trading day. Premarket trades are conducted mainly through electronic systems (ECNs) and are available through many brokerages, but liquidity is often thinner than in regular hours, and price discovery can be less precise.

Hours and scope: In the United States, premarket trading commonly runs from about 4:00 a.m. to 9:30 a.m. Eastern Time, with variations by exchange and broker. Some markets operate with shorter windows. Orders placed during premarket may execute at prices that differ from the opening price.

Prices in the premarket are driven by news, earnings releases, and global market sentiment. Spreads tend to be wider and volatility can be higher. Traders may use limit orders to control execution price; market orders can be filled at unexpected prices or not at all if liquidity is too thin.

Premarket is part of extended trading hours that precede the regular session; after-hours trading occurs after the close. Both periods have reduced liquidity and higher risk compared to normal trading hours. Access to premarket trading is typically offered by brokers but may be restricted for some accounts or securities.