Why should you use the pre-market?

Get a jump on the competition: Astute traders and investors who are familiar with trading patterns and experienced in extended-hours trading may use the pre-market to buy or sell stocks at more favorable prices, compared to prices obtained by other traders in the regular session.

What time does pre-market trading start?

Several direct-access brokers allow access to pre-market trading to commence as early as 4 a.m. EST from Monday through Friday. It is important to remember there is very little activity for most stocks so early in the morning unless there is news. The liquidity is also extremely thin, with most stocks only showing stub quotes.

What are pre-market trading volumes?

As a result, pre-market trading volumes are generally a fraction of volumes in the regular session. Low trading volumes result in limited liquidity, greater volatility, and wide bid-ask spreads. Price uncertainty: Prices of stocks traded in the pre-market may diverge significantly from the prices of those stocks during regular hours.

Do retail brokers offer pre-market trading?

Many retail brokers offer pre-market trading but may limit the types of orders that can be made during the pre-market period. Several direct-access brokers allow access to pre-market trading to commence as early as 4 a.m. EST from Monday through Friday.