WHY DO STOCK PRICES CHANGE WHEN MARKET IS CLOSED?

 

The prices of stocks are fluid and constantly changing. The price that you see at any point of the day is the last traded price of the stock/share. Stock exchanges facilitate trade in stocks by matching sellers with buyers and buyers with sellers. You may have noticed that stock prices change even when the market is closed. In this article, we will analyze why this phenomenon occurs.

The rise of after-hours trading (AHT) has had a significant impact on the stock prices even after the closing and opening bell. This is because the transactions are happening even after the closing bell is rung. This (AHT) moves stock prices when the market is closed.

HOW DOES AFTER-HOURS TRADING (ATH) AFFECT STOCK PRICES?

After-hour trading (ATH) occurs after regular market hours. Here the exchange matched potential buyers and sellers.  ATH is more volatile and riskier as the trading volume and liquidity is much lower than during regular hours. The opening price of a stock may be quite different than its previous day’s close due to ATH. In the hours between the closing bell and the following trading day’s opening bell, a number of factors can affect the attractiveness of a particular stock.


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