After-hours trading can be a powerful tool for investors, allowing you to react quickly to news and events that occur outside of the standard market hours. However, it comes with its own set of complexities and risks that you must understand before diving in. This comprehensive guide will walk you through everything you need to know about after-hours trading on E*TRADE, step by step.
Navigating the Markets Beyond Regular Hours: Your E*TRADE After-Hours Trading Guide
Hey there, savvy investor! Are you tired of missing out on crucial market movements because you're stuck in a 9-to-5 or simply want the flexibility to trade when it suits you best? You're not alone! The traditional stock market hours (9:30 AM to 4:00 PM ET) don't always align with breaking news, earnings reports, or your personal schedule. That's where after-hours trading on platforms like E*TRADE comes in.
This guide will demystify after-hours trading, equip you with the knowledge to navigate its unique landscape, and show you exactly how to place those orders on E*TRADE. Let's get started!
 |
| How To Do After Hours Trading On Etrade |
Step 1: Understand What "After-Hours" Truly Means
Before you even think about placing a trade, it's crucial to grasp what "after-hours" signifies in the context of the stock market and E*TRADE.
1.1 Defining Extended Hours Trading
"Extended hours trading" encompasses all trading activity that occurs outside of the standard market hours. On E*TRADE, this is typically broken down into:
Pre-Market Session: 7:00 a.m. to 9:30 a.m. ET, Monday through Friday. This allows you to react to news released before the market opens.
After-Market Session: 4:00 p.m. to 8:00 p.m. ET, Monday through Friday. This is the "after-hours" session we're primarily focusing on, allowing you to trade after the closing bell.
Extended Hours Overnight Session: 8:00 p.m. until 7:00 a.m. ET, Sunday through Thursday. This session is for certain ETFs and offers even greater flexibility, though with additional considerations.
Important Note: These hours are for official market business days, excluding market holidays. Always double-check E*TRADE's specific holiday schedule.
1.2 Why After-Hours Trading Exists
After-hours trading gained prominence with the rise of Electronic Communication Networks (ECNs). These are automated systems that match buy and sell orders directly, bypassing traditional exchanges which close their doors. This allows investors to:
React swiftly to news: Company earnings reports, major economic data, or even geopolitical events often break outside regular trading hours. After-hours trading allows you to act on this information immediately.
Gain flexibility: For those with busy daytime schedules, extended hours offer a window to manage their portfolios.
Potentially capitalize on price opportunities: Significant price movements can occur based on after-hours news, offering opportunities for nimble traders.
Step 2: Acknowledge the Risks – Don't Skip This!
While after-hours trading offers compelling advantages, it's paramount to understand the heightened risks involved. This is not the same environment as regular market hours.
2.1 Lower Liquidity
What it means: Fewer buyers and sellers are participating.
Impact: It can be difficult to execute your orders, especially for less popular stocks. You might not be able to buy or sell at your desired price, or at all. This also leads to wider bid-ask spreads.
2.2 Wider Bid-Ask Spreads
Tip: Reading on mobile? Zoom in for better comfort.
What it means: The difference between the highest price a buyer is willing to pay (bid) and the lowest price a seller is willing to accept (ask) is often significantly larger than during regular hours.
Impact: You might end up buying at a higher price or selling at a lower price than you anticipated, eating into your potential profits or increasing your losses.
2.3 Higher Volatility
What it means: Due to lower liquidity and fewer participants, a single large order can cause a disproportionately significant price swing.
Impact: Prices can move drastically in a short amount of time, making it harder to predict outcomes and potentially leading to rapid and substantial losses.
2.4 Price Uncertainty
What it means: The prices you see during extended hours may not accurately reflect the stock's true value, or the price it will open at during the next regular trading session.
Impact: A stock that soared after-hours might plummet at market open, and vice-versa. Don't assume after-hours performance will carry over directly.
2.5 Competition with Professional Traders
What it means: A significant portion of after-hours trading volume comes from institutional investors and professional traders who have access to more sophisticated tools, information, and capital.
Impact: As a retail investor, you might be at a disadvantage in this environment.
2.6 Limited Order Types
What it means: E*TRADE, like many brokers, typically only accepts limit orders for extended hours trading. Market orders are generally not accepted.
Impact: While this is a safety measure (it ensures you don't buy or sell at an unexpectedly bad price), it also means your order might not be filled if the price moves away from your specified limit.
Step 3: Ensure Your E*TRADE Account is Ready
Before you can place an after-hours trade, confirm your E*TRADE account is set up for it.
3.1 Account Eligibility
Generally, if you have a standard E*TRADE brokerage account, you are eligible for extended hours trading. However, it's always a good idea to:
Review the Extended Hours Trading Agreement: ETRADE provides a detailed agreement outlining the terms and conditions. You likely agreed to this when opening your account, but a re-read is recommended. You can usually find this in the "Disclosure Library" on the ETRADE website.
Verify Securities Eligibility: Not all securities are available for after-hours trading. While most major stocks and ETFs are, check if your specific security is tradable during extended hours.
Step 4: Placing an After-Hours Trade on E*TRADE (Web Platform)
Here's a step-by-step guide to placing an after-hours trade using the E*TRADE web platform:
4.1 Log In to Your E*TRADE Account
Go to the official E*TRADE website (etrade.com) and log in with your User ID and password.
4.2 Navigate to the Trading Interface
Reminder: Take a short break if the post feels long.
Once logged in, hover over the "Trade" tab in the top navigation bar.
From the dropdown menu, select "Stocks & ETFs" (or the relevant asset type you wish to trade).
4.3 Enter Your Order Details
Symbol: Enter the ticker symbol of the stock or ETF you want to trade (e.g., TSLA, AAPL, SPY).
Action: Select "Buy" or "Sell."
Quantity: Enter the number of shares you wish to trade.
Order Type: This is critical for after-hours trading.
Change the order type from "Market" (which is usually the default) to "Limit." As discussed earlier, market orders are typically not accepted during extended hours due to price volatility.
Enter your Limit Price. This is the maximum price you are willing to pay for a buy order, or the minimum price you are willing to accept for a sell order. Be realistic but also protective of your capital, considering the wider spreads.
Time in Force: This is another crucial setting for extended hours trading.
You'll need to select an option that allows for extended hours execution. Look for options like "EXT" (Extended Hours) or "GTC EXT" (Good-Til-Canceled Extended Hours).
"EXT" or "Day + EXT": This order will be active for the current extended hours session and may roll over into the regular session if not filled.
"Overnight" or "GTC Overnight": If you're looking to trade during the Extended Hours Overnight Session (8 PM - 7 AM ET), you'll need to select an order type specifically for that. Be aware that orders not executed by 4 AM ET in the overnight session will be cancelled and may need to be re-entered by phone if you wish to trade between 4 AM and 7 AM ET.
4.4 Review and Place Your Order
Carefully review all the details of your order: symbol, action, quantity, limit price, and time in force.
Double-check that the "Time in Force" explicitly includes extended hours. If it doesn't, your order will only be active during regular market hours.
Click "Preview Order."
Read the order summary and any warnings or disclaimers.
If everything looks correct, click "Place Order."
Step 5: Placing an After-Hours Trade on E*TRADE (Mobile App)
The process on the E*TRADE mobile app is very similar to the web platform, designed for ease of use on the go.
5.1 Open the E*TRADE Mobile App and Log In
Launch the E*TRADE app on your smartphone or tablet and enter your credentials.
5.2 Access the Trading Section
Look for a "Trade" icon or tab, usually at the bottom or top of the screen. Tap on it.
5.3 Input Your Trade Details
Search for Symbol: Use the search bar to find the stock or ETF you want to trade.
Buy/Sell: Select your desired action.
Quantity: Enter the number of shares.
Order Type: Again, select "Limit."
Limit Price: Input your desired limit price.
Time in Force / Duration: Tap on this option. You'll likely see choices like "Day," "GTC," and options that include "Extended Hours" or "EXT." Select the appropriate extended hours option (e.g., "Day + EXT," "EXT," or "Overnight" if applicable).
5.4 Review and Confirm
Just like on the web platform, a summary of your order will be displayed.
Verify that the order specifies extended hours trading.
Confirm the details and tap "Place Order."
Step 6: Monitor Your Order
After placing an after-hours order, it's essential to monitor its status.
6.1 Check Order Status
On the E*TRADE web platform, go to "Accounts" > "Orders."
On the mobile app, look for an "Orders" or "Activity" section.
Here, you can see if your order is "Open," "Partially Filled," "Filled," or "Canceled."
Tip: Focus more on ideas, less on words.
6.2 Understand Order Execution
Partial Fills: Due to lower liquidity, it's common for after-hours orders to be partially filled. This means only a portion of your requested shares were traded. The remaining shares of your order will remain open.
No Fills: Your order might not be filled at all if the market price doesn't reach your limit, or if there isn't enough liquidity to match your trade.
Cancellations: If your order isn't filled by the end of the specified extended hours session (or by 4 AM ET for overnight sessions), it will typically be canceled. You'll need to re-enter it if you still wish to trade.
Step 7: Post-Trade Considerations
Once your after-hours trade is executed, consider the following:
7.1 Settlement
Trades executed during extended hours generally settle on the same cycle as regular hours trading (typically T+1, meaning trade date plus one business day).
For the Extended Hours Overnight Session trades executed between 8 PM and 11:59 PM ET, the settlement date will typically be T+2 (trade date plus two business days).
7.2 News and Market Open Impact
Remember that any news or events that unfold between the end of the after-hours session and the next market open can significantly impact the stock's price.
Be prepared for potential gaps in price between the after-hours close and the regular market open.
Conclusion: Trade Wisely in the Extended Hours
After-hours trading on E*TRADE offers flexibility and the chance to react to immediate market-moving news. However, the unique characteristics of this environment – particularly lower liquidity, wider spreads, and higher volatility – demand a cautious and informed approach. Always use limit orders and thoroughly understand the risks before placing your trades. With proper preparation and a keen eye on market developments, you can leverage extended hours trading to your advantage.
10 Related FAQ Questions
Here are 10 common questions about after-hours trading on E*TRADE, with quick answers:
How to access extended hours trading on E*TRADE?
You access extended hours trading directly through the standard trading interface on the E*TRADE website or mobile app by selecting an "Extended Hours" or "EXT" option for your order's "Time in Force."
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 a "Time in Force" option that includes extended hours, such as "EXT" or "Day + EXT."
QuickTip: Reading regularly builds stronger recall.
How to check the status of my after-hours trade on E*TRADE?
You can check the status of your order by navigating to the "Orders" or "Activity" section within your E*TRADE account on either the web platform or the mobile app.
How to cancel an after-hours order on E*TRADE?
You can cancel an open after-hours order from the "Orders" section of your E*TRADE account. Locate the order and select the option to cancel it.
How to know if a stock is eligible for after-hours trading on E*TRADE?
Most major U.S. stocks and ETFs are eligible. When you enter a ticker symbol in the trade order entry, the available "Time in Force" options will indicate if extended hours trading is possible for that security.
How to understand the risks of after-hours trading?
The main risks include lower liquidity (fewer buyers/sellers), wider bid-ask spreads (larger difference between buy and sell prices), higher volatility (rapid price swings), and uncertain prices that may not reflect regular market performance.
How to differentiate between pre-market and after-market sessions on E*TRADE?
Pre-market runs from 7:00 a.m. to 9:30 a.m. ET, while after-market (after-hours) runs from 4:00 p.m. to 8:00 p.m. ET. E*TRADE also offers an overnight session for certain ETFs.
How to get help with E*TRADE after-hours trading issues?
You can contact E*TRADE customer service by phone at 800-387-2331. They are available 24/7 for brokerage and bank account support.
How to view after-hours stock quotes on E*TRADE?
E*TRADE's platform should display real-time quotes during extended hours. You may need to refresh your screen or ensure you are looking at the extended hours data.
How to prepare for after-hours trading on E*TRADE as a beginner?
Start by understanding the heightened risks, especially liquidity and volatility. Begin with small positions, focus on highly liquid stocks, and always use limit orders. Consider practicing with a paper trading account first if E*TRADE offers one.
 |
