After markets and pre-markets

Discussion in 'Options' started by bc1, Jan 19, 2012.

  1. bc1

    bc1

    Hi, I've been noticing in the evening when going over charts that many stocks keep trading until 7 pm cst. I've noticed in the past the pre-market trading but didn't worry about it. Can anyone tell me who is doing it and where this evening and morning trading is taking place?

    I also tried to sell some Bidu 130/135 call spreads at the mark just before 3:00 cst today and they didn't trade. There was some slippage so I changed my order just after 3 thinking I had till 3:15 as usual. However it said it wouldn't go through till the market opened in the morning. Anyone know why it closed early today? Thanks.
     
  2. QQQ's options trade till 4:15pm EST, I'm sure options for BIDU trades till 4:00pm EST only. I think the modified order was too late.
     
  3. This trading is done by anyone who wants to trade at those hours. It takes place on ECNs (Electronic Communications Networks) which match buy and sell orders that have the same price.

    Be very careful with pre/post market trading. B/A spreads tend to be wide and due to low liquidity, price can move rapidly.
     
  4. bc1

    bc1

    Thanks. Is it the ECN trading that causes stock prices to gap up or down in the morning and how does the /ES (s&P500 mini) effect a stock to get a gap up or down?
     
  5. Gaps are caused by changes in the fundamentals of a stock (news, earnings, rumors, etc) it is reflected in trades made on the ECN's but it is not caused by the trades on the ECN's...
     
  6. Gaps are caused by order imbalances - usually prompted by company news. In order to meet this buy (or sell) demand, the market maker will raise/lower price until it attracts enough sellers/buyers to enter and offset that demand and that price is about where the gap open is.
     
  7. bc1

    bc1

    Thanks guys. Figured out I can track stock prices overnight in the futures trader tab of TOS. Got my bidu options sold but less than yesterday.
     
  8. cqm

    cqm

    you can also trade futures and potentially hedge your overnight exposure.