Beginner's Must-Read: How to Participate in US Stock Pre-Market and After-Hours Trading on Friday

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You can participate in US stock pre-market and after-hours trading on Friday. This session provides an opportunity to quickly respond to sudden market news.

Key Time Points: After the US stock market closes at 4:00 PM Eastern Time on Friday afternoon, after-hours trading opens and continues until 8:00 PM.

Key Takeaways

• Friday US stock pre-market and after-hours trading offers opportunities to quickly respond to market news.
• In pre-market and after-hours sessions, you must use limit orders to control trading price and risk.
• Friday after-hours trading is high risk due to low market liquidity and inability to trade over the weekend.
• Beginners should strictly manage positions and master reliable information sources to handle high risks.
• Stop-loss orders are ineffective in pre-market and after-hours sessions; you need to manually close positions to protect capital.

Friday Pre-Market and After-Hours Trading: Basics

Before diving into specific operations, you need to master some basic concepts. This will help you understand how extended hours trading works and potential opportunities.

What Is Extended Hours Trading

Extended hours trading refers to buying and selling stocks outside regular trading hours. Regular trading hours are Eastern Time 9:30 AM to 4:00 PM. Extended hours include two parts:

• Pre-Market Trading: From Eastern Time 4:00 AM until 9:30 AM open.
• After-Hours Trading: From Eastern Time 4:00 PM close, continuing until 8:00 PM.

In the past, such trading was mainly dominated by institutional investors. With the development of Electronic Communication Networks (ECN) technology, ordinary investors can now conveniently participate, allowing you to respond promptly to after-hours company earnings or breaking news.

Full Breakdown of Friday Trading Hours (with Beijing Time)

For mainland Chinese traders, accurately grasping corresponding times is crucial. Due to US daylight saving and standard time changes, Beijing time adjusts accordingly.

Tip: US daylight saving time usually starts the second Sunday in March and ends the first Sunday in November. Pay attention to this change to avoid missing trading opportunities.

You can refer to the table below to plan your Friday trading:

Differences Between Pre/After-Hours and Overnight Trading

You may have heard of “overnight trading,” which differs from pre-market and after-hours trading. Overnight usually refers to trading from Eastern Time 8:00 PM to next day 4:00 AM.

Main differences are:

1. Market Regulation Different: In regular sessions, regulations require brokers to execute your orders at the “National Best Bid and Offer (NBBO).” But in pre/after-hours and overnight sessions, this rule does not apply; your execution price may not be optimal.
2. Market Depth Different: After Friday afternoon’s US stock market close entering after-hours, volume significantly drops. Compared to pre/after-hours, overnight has even lower volume, wider spreads, and potentially higher trading costs.
3. Participants Different: Overnight trading participants are mostly retail investors, especially from Asian regions.

Simply put, pre-market and after-hours trading extend regular sessions, while overnight is an independent trading window with lower liquidity and higher risk.

Beginner’s Guide: Pre-Market and After-Hours Trading Operations

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After understanding basics, now learn actual operations. Participating in pre-market and after-hours trading is not complex, but you need to follow specific steps to ensure orders execute correctly. This guide walks you through the entire process step by step.

Step 1: Choose a Supporting Broker

First, you need a brokerage account that supports extended hours trading. Most mainstream brokers offer this feature; for example, Biyapay is a good choice, providing convenient pre-market and after-hours trading channels for users.

Usually, you only need a standard brokerage account. Some brokers also allow after-hours trading in retirement accounts (like IRA). Before opening an account or trading, confirm your account has extended hours trading approval.

To give you a more comprehensive market overview, here are some mainstream brokers and their after-hours times:

From the chart, you can intuitively see varying extended trading durations across brokers, with Webull offering the longest pre-market hours.

Fee Reminder: Though many brokers advertise zero commissions, still note specific rules. For example, some brokers stipulate that if your pre-market/after-hours volume exceeds a certain percentage of monthly total (e.g., 10%), extra fees may apply, such as $0.005 per share.

Step 2: Order Placement Process Step-by-Step Illustration

After selecting a broker, we use mainstream trading apps like Biyapay as an example to show specific order placement steps. Though interfaces vary slightly, core logic is identical.

1. Find the Stock You Want to Trade In the app search box, enter the stock ticker (e.g., AAPL or TSLA) and enter the stock detail page.
2. Open the Trading Interface Click the “Trade” or “Buy/Sell” button at the page bottom; the system pops up the order setup window.
3. Fill Order Information This is the most critical step. Here you set order type, price, quantity, and enable after-hours trading option.

Key Operations

• Check “Allow Pre/After-Hours Trading”: In some position on the order interface, you usually see a switch or checkbox named “Allow Pre/After-Hours Trading” or “Extended Session.” You must manually check it; otherwise, your order only effective in regular session.
• Select “Limit Order”: In the order type field, you must choose limit order. Market orders are unavailable in pre-market/after-hours.

After completing above settings, enter the number of shares to buy or sell, check order information correct, then click “Buy” or “Sell” to submit.

Step 3: Set Limit Order to Complete Trade

You might ask why limit orders are mandatory. This protects you from unique risks of extended hours trading.

After Friday afternoon’s US stock market regular close, market participants decrease significantly, leading to:

• Thin Liquidity: Far fewer buyers and sellers; your order may not fill or only partially.
• Wider Spreads: Gap between buy and sell prices widens significantly. This means potentially higher trading costs.
• Increased Volatility: Even small trades can cause sharp price swings.

Precisely because of this, brokers mandate limit orders to control risk.

Beginner Tip: What Is a Limit Order? A limit order allows you to specify a “maximum buy price” or “minimum sell price.”

• When Buying: Your order only executes at or below your set limit price. This prevents buying high if price suddenly surges.
• When Selling: Your order only executes at or above your set limit price. This ensures you do not sell low if price crashes.

Simply put, limit orders provide you a price protection net, ensuring execution price does not deviate from expectations.

If your limit order remains unfilled at pre-market or after-hours session end, it usually automatically expires and cancels. If you want the order to remain valid for future days, choose “Good-til-Cancelled (GTC)” option, but note not all brokers support GTC in extended hours.

Friday Trading Risks and Coping Strategies

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You have learned order placement, but more importantly understand and manage risks. Friday after-hours trading has both opportunities and risks, especially higher for beginners. This section deeply analyzes these risks and provides actionable coping strategies.

Why Friday After-Hours Trading Risk Is Higher

Friday after-hours trading risk mainly stems from two core factors: reduced liquidity and weekend uncertainty.

First, after regular session close, market participants drop sharply. This means far fewer buyers and sellers, leading to a series of issues:

• Liquidity Decline and Volatility Increase: Market liquidity and price volatility have clear inverse relationship. When liquidity drops, even small buy/sell orders can cause large price swings. History shows in volatile times (like January 2022), trading costs significantly rise with wider spreads.
• Execution Difficulty: With fewer pending orders, your limit order may not fill or only partially.

Weekend Lock-In Risk More critical is that after Friday after-hours close, the market shuts for over two days. During this long period, you cannot react to any sudden global news or company-specific events. You are forced to hold positions until Monday open. This untradeable “lock-in” state greatly amplifies holding risk, as you cannot timely stop-loss or take profits.

Focus on Friday Afternoon’s US Stock Market: Risks and Opportunities

When the regular trading bell rings on Friday afternoon’s US stock market, a special trading window opens. Though full of risks, it also offers unique opportunities for informed investors.

• Risks: As mentioned, low liquidity and wider spreads are main risks. Prices may experience irrational surges or crashes, causing slippage losses.
• Opportunities: After-hours is peak time for company important announcements. For example, some companies choose Friday close to release earnings, announce M&A, or other major news (like SEC 8-K filings). If you access and correctly interpret this information first, you have opportunity to position ahead of other investors.

Channels for this information include professional finance news sites, broker news pushes, and the US Securities and Exchange Commission (SEC) official disclosure platform. For example, Nasdaq.com updates company-submitted SEC filings and latest news in real time.

Three Coping Strategies Beginners Must Master

Facing high-risk environment, you cannot enter unprepared. The following three strategies are cornerstones for beginners safely participating in Friday after-hours trading.

1. Strictly Manage Your Positions

In high-volatility markets, controlling position size is controlling risk. You should not use the same capital amount as regular sessions. Here introduce two position management methods commonly used by professional traders.

For beginners, fixed risk percentage method is easier. Its core is that loss you are willing to bear in a single trade should not exceed a fixed percentage of total account assets (usually recommended 0.5% - 1%).

How to Calculate Position Size?

Position Size (Shares) = (Account Total × Risk Percentage) / (Your Entry Price - Your Stop-Loss Price)

Example: Suppose your account has $10,000. You decide single trade risk not exceeding 1% of account (i.e., $100). You target a stock, plan to buy at $50, set stop-loss at $48.

• Per Share Risk = $50 - $48 = $2
• Shares You Can Buy = $100 / $2 = 50 shares

This way, even if trade fails hitting stop-loss, your loss is strictly controlled within $100. When Friday afternoon’s US stock market closes entering high-volatility session, you can lower risk percentage (e.g., 0.5%) to further reduce position and protect principal.

2. Master Reliable Information Sources

After-hours trading is information-driven. You need to build your information channels to quickly judge when major news releases. Besides Nasdaq.com mentioned earlier, also follow tools tracking SEC filings. When a company submits potentially price-moving 8-K filings, these tools notify you first.

3. Understand Your Order Limits

This is one of the easiest mistakes for beginners. You must be clear that not all order types are effective in after-hours.

Important Reminder: Stop-Loss Orders Ineffective in After-Hours

“Typically, stop-loss orders and stop-limit orders only trigger during regular trading hours Eastern Time 9:30 AM to 4:00 PM. This means these orders will not activate in pre-market, after-hours, weekends, or market holidays.”

Thus, you cannot rely on automatic stop-loss orders to protect after-hours positions. Your only protection nets are limit orders and strict position management. If market moves against you, you need to manually submit limit sell orders to close.

Participating in Friday after-hours trading, remember these three key points:

1. Memorize Times: Master Eastern and Beijing time correspondence.
2. Learn Limit Orders: This is your only trading protection net.
3. Beware Weekend Risk: Low liquidity widens bid-ask spreads, increasing trading costs.

Pre-market and after-hours trading is highly volatile; recommend starting with observation or simulation. For real trading, strictly control positions and start small. Investing is a continuous learning process; cautious decisions are key to long-term success.

FAQ

What if my after-hours order does not fill?

Your limit order, if unfilled at after-hours session end, usually automatically expires and cancels. No manual action needed. If you want the order to remain valid, check if your broker supports “Good-Til-Cancelled” (GTC) orders and reset accordingly.

Do pre-market and after-hours trading charge extra fees?

Most brokers do not charge extra commissions, but you still pay regulatory fees.

Note: Some brokers may have special rules for high-frequency or large-volume pre-market/after-hours trading, potentially incurring extra fees. Best to review broker fee explanations before trading.

Can all US stocks participate in pre-market and after-hours trading?

No. Only stocks listed on Electronic Communication Networks (ECN) can. Usually, high-volume, well-known company stocks can, but some small-cap or over-the-counter (OTC) stocks may not.

Why can’t I use market orders in pre-market and after-hours?

Because pre-market and after-hours sessions have low liquidity and sharp volatility. Brokers, to protect you from executing at unexpected bad prices, usually disable market orders. You must use limit orders to specify your trading price.