Research. Discover. Freedom.

After Hours Trading Is a Dangerous Game

After hours trading is not for everyone and I don’t recommend it unless you’re a savvy investor or you desperately need to get into or out of a stock.

The reason is that most market makers will widen the spread after the market closes. This means you’re going to get a higher ask price if you want to buy and a lower bid price if you want to sell. Market makers do this to milk the desperate investor.

There are cases where trading after hours could benefit or save you from further losses. If significant news comes out after the close and then buying or selling after hours may be required. For most cases, waiting for the next day to put your order is the best choice.

The thin volume of most stocks after the market closes will not give you an advantage.

Over The Counter Stocks and NYSE stocks don’t trade after hours either.

Related Articles