Can someone please explain to me how an order is filled after hours such as is it placed in a queue in the order it was received or is it up to the discretion of a specialist, etc? It seems to me that if I place a limit order, there isn't much danger. However, I have heard of a stock gapping down and a previous after hours stop loss not taking effect. Why does this happen? Thanks in advance.
Order triggering after hours depends on how you set it up in your trading software. You can set up platforms to allow triggering outside of regular session, or to only trigger during regular session. You'll be given a ride to the bank if you use a market order after session, especially on a thin stock. Best to use limits after hours.
If you place your limit through an ecn, it will sit until someone hits it, which may or may not happen. Not sure how it works if a specialist has your order. I always send my after hour orders to arca or island.
A gapping stock may go from price a to b without trading between. In that case, a hard stop won't get you out at a better price. A stop allowed to trigger based on a price may trigger because of the after hour spread, and may take you out when you don't want to be out.