Extended hours trading risks
Extended hours trading offers more flexibility but comes with increased risks compared to regular trading hours.
Main risks of extended hours trading
Lower liquidity
Fewer participants mean lower chances of order execution. Orders may be partially filled or not executed, even if your limit price is met or exceeded.
Larger bid/ask spreads
A larger gap between bid and ask prices can lead to higher costs when buying or selling.
Increased volatility
Limited participants can cause drastic and rapid price swings.
Price discrepancies
Prices during extended hours may not reflect those in the next regular session, leading to unexpected price changes.
Impact of news
News released during extended hours can have a stronger effect on stock prices than news released during regular hours.
Extended hours trading might not be suitable for everyone. For more details, review Revolut’s Risk Disclosure.