Stock Market Opening Vs. Closing

Investors buy and sell shares of a company on the stock market with the goal of maximizing profit. The price of the stock may fluctuate throughout the day. How the stock performs helps the investor decide if he wants to keep the stock or sell it. The buying and selling of stock typically occurs between the opening and closing of the stock market.

Stock Markets

In terms of dollar volume, the New York Stock Exchange (NYSE) is the largest stock market in the United States. It's the second-largest in terms of listed companies and is also second-largest in daily share volume behind the National Association of Securities Dealers Automated Quotations, or NASDAQ. These two represent the major U.S. stock markets. When someone makes a reference to the stock market, they're usually referring to the activity that takes place on the NYSE or NASDAQ.

Significance

"Opening bell" refers to the time when the stock market opens and the trading day begins. The markets open Monday through Friday beginning at 9:30 a.m. Eastern Standard Time. Once the market is open, investors are free to trade stock. The "closing bell" is when the market closes and the trading day ends. The NYSE and NASDAQ both close at 4 p.m. Eastern Standard Time. Individual investors with access to an electronic communications network, or ECN, may perform limited trades before the market opens or after the market closes every day. Access to an ECN is generally acquired by being a customer of a brokerage firm. Pre-market trading hours are from 7 to 9:30 a.m. Eastern Standard Time and after-market hours are from 4 to 8 p.m. Eastern Standard Time.

Considerations

The stock market has a predictable timetable. Although the stock market opens and closes on a set schedule, that schedule is altered on occasion. The market observes certain holidays and remains closed on those days. These holidays include New Year's Day, Martin Luther King Jr. Day, Washington's birthday, Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving and Christmas. Stocks are not traded on the NYSE nor the NASDAQ on days when the markets are closed.

Other Countries

The NYSE and NASDAQ are the two largest stock markets in the United States, but other countries have their own stock markets. In England you have the London Stock Exchange, or LSE. Japan has the Tokyo Stock Exchange, or TKE. The opening and closing times for these foreign stock markets vary depending on the country and on which holidays or events the country observes.

About the Author

Mack Mitzsheva is a tax lawyer, personal finance expert and the author of the forthcoming ebook, "10 Best Places to Work Online." Mitzsheva is also a social media entrepreneur with five successful sites under her belt. Always innovative, Mitzsheva is currently developing a cutting-edge budgeting app for newlyweds.

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