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Larsen Kusick
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What does the term "extended hours" mean? I have noticed it on several stocks I have, and it is different than the closing price. How does it affect the stocks, and how does it work? I thought when the market closed for the day that was it until the following day's trading. -- R Many investors have probably noticed -- via Yahoo! Finance or a similar site for stock quotes -- that a stock's price moves not only during the normal 9:30 a.m.- to-4 p.m. trading day but also before the open and after the close each day. This is what is referred to as extended-hours trading, a practice that has become more common with the rise of ECNs (electronic communications networks), which directly match up buyers and sellers of particular stocks. Many brokerages such as E*Trade allow their customers access to these ECNs, provided they fill out a special trading agreement and are willing to pay an additional, per-share ECN fee. The after-hours market exists because, well, some institutions and individuals want to be able to make a trade beyond the limits of the normal trading day. And in the world of finance, where there's demand for a product, someone will come up with that product. However, the majority of investors (especially beginners) should stay away from extended-hours trading because of the higher risks and extra fees.
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