What is Premarket Trading?
Premarket trading refers to the session before the regular opening hours of the stock market exchange. So when does premarket trading begin? This session lasts about one and a half hours and starts at 8 a.m. However, it can also start early, from around 4 a.m.
Where to Get Information on How to Trade in Premarket Stocks
Your broker is the first place to start. As you search for information on how to buy stocks premarket, check your broker’s policies. There are different policies on when you can place your limit order. On top of that, not all brokers allow premarket trading.
How to Buy Stock in Premarket
Premarket trading is different from the regular trading session, where stock market exchanges, such as the New York Stock Exchange, open between 9:30 in the morning and 4 p.m.
Therefore, the exchange isn’t responsible for these early morning trade sessions. Instead, they use an electronic communication network (ECN). It matches a buyer with a seller. Hence, you need a brokerage account. Before the session begins, log in and search for trading opportunities. When you find something you like, you place a limit order stating you want to buy or sell a certain quantity of equities. Additionally, you have to say the price.
FAQs About Premarket Trading
Can I buy options premarket?
No. When you research for information on how to trade options premarket, you discover that it omits even some stocks, such as the ones with limited float.
Can you buy during premarket?
Yes, you can place your limit order during the early morning session. There can be more trading activity early when there is unexpected market news.
Can you trade options in premarket? No, you can only do so in the regular session.
When is premarket trading?
It starts at 8 a.m. As you discover how to buy premarket from your broker, check their policies on when you can place your limit order.