The complete guide to US electronic trading: understand the timing, quotes, and risks all at once

Have You Fallen Into These Common Pitfalls?

“Closing the US stock market is the real time to make money” “Electronic trading runs 24/7, you can earn while lying down”—these popular sayings sound very tempting, but when you actually open your trading software, the screen filled with numbers and complex time zone conversions can instantly leave you at a loss. Don’t be fooled by these superficial “opportunities.” Today, we will delve into the truth about the US electronic trading market.

What is Electronic Trading (Night Trading)? Why Do Investors Pay Attention to It?

Traditional stock markets have fixed operating hours, like banks working nine to five. But with globalization, trading is no longer limited by geography, and electronic trading has emerged. It breaks the shackles of time, allowing investors to continue buying and selling outside regular trading hours.

Taking US stocks as an example, the standard trading hours are from 9:30 AM to 4:00 PM Eastern Time. However, after market close, many savvy investors and large institutions have already positioned themselves on electronic platforms, adjusting strategies based on news or overnight developments. US electronic trading covers stocks listed on NASDAQ, NYSE, and some ETFs.

As for futures markets, they are even more unique—almost operating around the clock. From crude oil and gold to various futures commodities, investors can respond to market fluctuations at any time, regardless of location. Taiwan’s market also launched night trading for futures in 2017, offering extended trading hours for products like TAIEX futures.

US Electronic Trading Hours: Miscalculations Mean Missed Opportunities

The US stock electronic trading (after-hours trading) runs from 4:00 PM to 8:00 PM Eastern Time, totaling 4 hours. However, due to daylight saving time (DST), the corresponding Taiwan time varies:

Note: DST is from the second Sunday in March to the first Sunday in November; Standard Time is from the first Sunday in November to the second Sunday in March.

US Futures Market: The Truly “Global Village” Trading Arena

Unlike stocks, the US futures market breaks the traditional trading hours. For example, stock index futures:

Note: Electronic trading on Mondays starts 1.5 hours later.

In contrast, Taiwan’s futures trading hours are relatively compact: index futures from 08:45 to 13:45 for day trading, and night trading from 15:00 to 05:00 the next day. Currency futures have even longer night sessions, extending from 17:25 to 05:00.

How to Check US Electronic Trading Quotes?

To stay updated on US electronic trading activity, you need to know where to look. The most direct way is to visit the official exchange websites or your broker’s platform. For example, on NASDAQ’s website, you can find after-hours trading pages showing real-time quotes for individual stocks like Tesla.

For US futures, the same applies—CME (Chicago Mercantile Exchange) is the main futures trading center, or you can use professional analysis tools like TradingView to get real-time data. These platforms typically offer clear candlestick charts and depth of market data.

What Are the Advantages of Electronic Trading?

Flexible Timing: No longer restricted by fixed trading hours, investors can react quickly to overnight news or market expectations, positioning themselves early in promising assets.

Global Participation for Better Markets: Investors from around the world gather here, making trading more fair, transparent, and efficient. The increased market size means more liquidity and more accurate pricing.

New Opportunities for Short-term Trading: Savvy traders can leverage electronic trading to capture price swings and engage in flexible short-term investments.

Hidden Risks You Should Not Ignore

While US electronic trading offers convenience, its risks are equally significant:

Liquidity Might Be Insufficient: After-hours trading involves far fewer participants than regular hours, and some stocks may have very sparse order books. When you want to execute a trade, it might be difficult to find counterparties willing to trade at your desired price, or there may be no trading activity at all.

Wider Spreads, Higher Costs: Due to lower trading volume, bid-ask spreads tend to widen significantly. This means each trade incurs higher costs, eating into your profits.

Institutional Domination: Active participants are often large institutions with ample information and capital. Retail investors face a clear informational asymmetry disadvantage.

More Volatile Prices: Overnight risks and news uncertainties can cause prices to gap open sharply the next day, leading to substantial losses for unprepared investors.

Order Restrictions and System Risks: US after-hours markets only accept limit orders—you must set your own stop-loss and take-profit levels. Additionally, automated systems may malfunction or delay, preventing timely order execution.

Differences in Quotes Across Platforms: Different trading systems may display varying quotes. Even if one platform shows a favorable price, it doesn’t guarantee you can execute at that price on another platform.

Summary: Participate Rationally, Make Cautious Decisions

US electronic trading indeed offers global investors greater flexibility in time and space, but it is not a shortcut to “earn money while lying down.” Successful traders often recognize both sides of electronic trading—the proximity to market pulse and the risks of low liquidity and volatile prices. Before entering the electronic market, thoroughly understand the specific rules of your platform, assess your risk tolerance, and make rational investment decisions. Frequent trading does not guarantee profits; prudence and patience are often the true secrets to wealth.