Ready to dive into the exciting world of after-hours trading with E*TRADE? It's a fantastic way to react quickly to breaking news and potentially capitalize on market movements outside of the regular trading day. However, it also comes with its own set of unique risks, so it's crucial to understand how it works before you jump in.
Let's get you set up to trade during extended hours on E*TRADE!
Unlocking After-Hours Trading on E*TRADE: Your Comprehensive Guide
After-hours trading, also known as extended-hours trading, allows you to buy and sell securities outside of the standard 9:30 AM to 4:00 PM ET market hours. E*TRADE offers both pre-market and after-market sessions, providing ample opportunity for savvy traders.
Step 1: Are You Ready for the Extended Market? Understand the Landscape and Risks
Before we even touch a button on E*TRADE, it's essential to grasp what you're stepping into. Extended hours trading isn't just "more of the same" as regular trading; it has distinct characteristics and inherent risks.
What are E*TRADE's Extended Hours?
E*TRADE provides access to several extended trading sessions:
Pre-Market Session: Typically 7:00 AM to 9:25 AM ET, Monday through Friday. Orders placed during the previous trading day (after 8:05 PM ET) or in the early morning can be eligible for execution during this time.
After-Market Session: Typically 4:05 PM to 8:00 PM ET, Monday through Friday. Orders placed within this window are eligible for execution.
Extended + Overnight Sessions: For certain ETFs and other securities, ETRADE may offer even longer, continuous trading, sometimes 24 hours, Sunday through Thursday (8 PM ET to 7 AM ET). Check ETRADE's specific agreements for details on eligible securities and times.
The Crucial Risks of Extended Hours Trading:
It's not all sunshine and profits. Be aware of these significant risks:
Limited Liquidity: This is perhaps the biggest risk. Fewer participants means it can be harder to buy or sell a security, especially large quantities, at your desired price. You might find fewer buyers or sellers for the stock you want to trade.
Wider Bid-Ask Spreads: Due to lower liquidity, the difference between the highest price a buyer is willing to pay (bid) and the lowest price a seller is willing to accept (ask) can be significantly wider than during regular hours. This means you might get a less favorable price for your trade.
Increased Volatility: Lower trading volume can lead to exaggerated price swings. A small order can have a larger impact on the price. News released after hours can cause sudden and dramatic price movements.
Price Uncertainty: The prices you see during extended hours may not accurately reflect the stock's price when the regular market opens. What goes up (or down) after hours might reverse itself quickly once more liquidity enters the market.
Competition with Institutional Investors: A significant portion of after-hours trading is conducted by large institutional investors with advanced tools and resources. Individual investors can be at a disadvantage.
Limited Order Types: E*TRADE generally only accepts limit orders for extended-hours trading. Market orders, which guarantee execution but not price, are typically not accepted. Other complex order types might also be unavailable.
Orders Are Day Orders Only (Typically): Orders placed for extended hours are usually "Day Orders," meaning they expire at the end of that specific extended-hours session if not filled. Good-Till-Canceled (GTC) orders are generally not accepted for extended hours.
Think carefully about your risk tolerance and trading strategy before proceeding.
Step 2: Ensure Your E*TRADE Account is Ready
While E*TRADE generally allows extended-hours trading by default for most brokerage accounts, it's always good to confirm and understand any specific requirements or settings.
2.1. Open an E*TRADE Account (If You Haven't Already)
If you're new to E*TRADE, the first step is to open a brokerage account. This involves providing personal and financial information and verifying your identity.
2.2. Review and Accept the Extended Hours Trading Agreement
E*TRADE, like other brokers, requires you to acknowledge and accept the risks associated with extended hours trading. This agreement typically outlines the terms, conditions, and risks involved.
How to Find It:
Log in to your E*TRADE account on their website (
us.etrade.com).Navigate to the "Disclosures" or "Agreement Library" section.
Look for the "Extended Hours Trading Agreement" or similar document.
Read it thoroughly! It's critical to understand the nuances of this type of trading.
Accept the terms if you agree to proceed.
Note: While ETRADE makes extended hours trading broadly available, there might be specific account types or situations where it's not immediately enabled or requires a separate sign-off. If you encounter any issues, contacting ETRADE customer support is the best course of action.
Step 3: Placing Your Extended-Hours Order on E*TRADE
Once your account is set up and you understand the risks, placing an order for extended hours is straightforward. Remember, only limit orders are typically accepted.
3.1. Log In to Your E*TRADE Platform
Access your E*TRADE account via:
E*TRADE Website:
us.etrade.comPower E*TRADE Platform: A more advanced trading platform offered by E*TRADE.
E*TRADE Mobile App: Convenient for on-the-go trading.
3.2. Navigate to the Order Entry Screen
Locate the "Trade" or "Place Order" section within your chosen platform.
3.3. Enter the Security Symbol
Input the ticker symbol of the stock or ETF you wish to trade (e.g., TSLA, AAPL, SPY).
3.4. Specify Your Order Details
This is where you tell E*TRADE you want to trade during extended hours.
Action: Select "Buy" or "Sell."
Quantity: Enter the number of shares you wish to trade.
Order Type: This is critical. You must select "Limit" as your order type. Market orders are generally not supported for extended hours.
What is a Limit Order? A limit order allows you to set the maximum price you're willing to pay when buying or the minimum price you're willing to accept when selling. Your order will only execute at your specified price or better.
Limit Price: Enter the exact price per share at which you want your order to be executed. Be realistic, considering the current bid/ask spread in the extended hours.
Time in Force: This is the most important setting for extended hours trading. Look for options like:
"EXT" (Extended Hours): This typically makes your order eligible for both pre-market and after-market sessions for the current day.
"EXTM" (Extended Hours Market): For pre-market.
"EXTA" (Extended Hours After-Market): For after-market.
ETRADE might simplify these to a single "Extended Hours" checkbox or a dropdown. Select the appropriate option to indicate you want your order to be eligible for trading outside regular market hours. If you don't select this, your limit order will likely default to a regular market hours order and won't execute until the next regular session, if at all.
3.5. Review and Place Your Order
Carefully review all the details of your order.
Confirm that you have selected the correct "Time in Force" for extended hours.
Click "Preview Order" or "Place Order." You might receive a pop-up warning you about the risks of extended-hours trading; read and confirm if you understand.
Step 4: Monitoring Your Extended-Hours Trades
Placing the order is only part of the process. Active monitoring is essential due to the volatile nature of extended hours.
4.1. Track Your Order Status
Go to your "Order Status" or "Open Orders" section on E*TRADE.
See if your order has been filled, partially filled, or remains open.
Remember, due to low liquidity, your limit order might not get filled at your desired price, or it might only be partially filled.
4.2. Stay Informed
Keep an eye on news feeds, especially those related to the company you're trading, as news releases often trigger after-hours price movements.
Monitor real-time quotes (if available and enabled on your platform) for the security.
4.3. Be Prepared to Adjust or Cancel
If market conditions change significantly or your order isn't filling, be ready to modify your limit price or cancel your order.
Orders not executed by the end of the extended-hours session will be canceled. You'll need to re-enter them if you still want to trade the next day.
Congratulations! You've now learned the steps to enable and execute after-hours trades on E*TRADE. Remember, knowledge is power, especially when navigating the unique landscape of extended-hours trading.
10 Related FAQ Questions
Here are 10 common "How to" questions related to after-hours trading on E*TRADE, with quick answers:
How to check if my E*TRADE account is enabled for after-hours trading?
You can typically confirm this by attempting to place an order and looking for the "Time in Force" options like "EXT" (Extended Hours). If you don't see them, review the "Extended Hours Trading Agreement" in E*TRADE's disclosure library or contact customer support.
How to place a limit order for after-hours trading on E*TRADE?
When placing your trade, select "Limit" as the order type and then choose an "Extended Hours" option (e.g., "EXT") for the "Time in Force."
How to view real-time quotes during after-hours on E*TRADE?
ETRADE platforms like Power ETRADE and the mobile app typically offer real-time quotes. Ensure you are logged in and looking at the appropriate quote details for extended hours.
How to cancel an after-hours trade on E*TRADE?
Navigate to your "Order Status" or "Open Orders" section within the E*TRADE platform, locate the unexecuted after-hours order, and select the option to cancel it.
How to understand the risks of after-hours trading on E*TRADE?
Read the "Extended Hours Trading Agreement" in E*TRADE's disclosure library. It specifically outlines risks like limited liquidity, wider bid-ask spreads, and increased volatility, which are crucial to comprehend before trading.
How to find which stocks are eligible for E*TRADE's extended hours trading?
While most actively traded stocks and ETFs are available, ETRADE reserves the right to limit securities. Generally, highly liquid securities are good candidates. For specific eligibility, check the platform's order entry screen or ETRADE's documentation.
How to interpret bid-ask spreads during E*TRADE's after-hours sessions?
A wider bid-ask spread during after-hours means there's a larger difference between the highest price a buyer is willing to pay and the lowest price a seller is willing to accept. This indicates lower liquidity and potentially less favorable execution prices.
How to set up alerts for news impacting my after-hours trades on E*TRADE?
E*TRADE's platforms often allow you to set up custom alerts for specific stocks, including news releases and price movements. Utilize these features to stay informed, especially during extended hours.
How to distinguish between pre-market and after-market trading on E*TRADE?
Pre-market trading occurs before the regular market opens (e.g., 7:00 AM - 9:25 AM ET), while after-market trading takes place after the regular market closes (e.g., 4:05 PM - 8:00 PM ET). The "Time in Force" options in the order entry screen typically differentiate between these sessions or cover both.
How to learn more about advanced after-hours trading strategies on E*TRADE?
E*TRADE's "Knowledge" or "Education" section on their website, particularly under "Advanced Trading," often provides articles, videos, and tutorials on various trading strategies, including those applicable to extended hours.
