Early Birds and Night Owls: How Extended Trading Hours are Reshaping U.S. Equities Markets

As access expands and global markets have become increasingly interconnected, U.S. exchanges have responded to domestic and international demand by offering extended trading hours. Cboe introduced early hours trading on its EDGX Equities Exchange (EDGX^®) from 4 a.m. – 7 a.m. ET in March 2021, and EDGX is now the second largest early hours trading exchange.

The Growth of Extended Trading Hours

Exchanges started offering after-hours trading outside of the regular 9:30 a.m. to 4:00 p.m. ET continuous trading session, around the turn of the century, and early hours trading (starting at 4 a.m. ET) in the late 2000s. Extended hours trading provides several benefits, such as the opportunity to react to earnings reports and major news as it breaks as well as improving accessibility for global investors to trade at more convenient times. However, it also comes with its own considerations, as session functionality is distinct and liquidity profiles adjust accordingly.

Where We Are Today

Early hours trading has grown consistently year-over-year since 2019 and notably reached 1% of overall Total Consolidated Volume (TCV) including auctions and off-exchange activity in the fourth quarter of 2024. EDGX’s market share has grown in lockstep and now makes up a third of early hours trading activity.

^{Source: Cboe Internal Data}

Differences in Extended Hours Trading

There are some key differences to how trading works during extended hours. Some are direct, such as the lack of the Order Protection Rule, which prevents trade-throughs of protected quotes, and the rejection of market orders. Others are indirect, like the resulting distribution profile of liquidity affecting trading behavior and the composition of retail flow.

Cboe’s EDGX’s order functionality during early hours trading is similar to the continuous session and retains the ability to route orders to other markets that have a better price, even though it is not a regulatory requirement. Cboe data shows that since 2023, routing has grown to make up approximately 15% of the volume executed through EDGX between 4 a.m. – 7 a.m. ET.

Liquidity Profile in Extended Hours Trading

The chart below breaks down trading activity by time increments and shows how early hours trading is primarily driven by demand beginning as soon as the session starts at 4:00 a.m. ET. This higher level of volume seen at 4:00 a.m. ET is likely from queued orders, as EDGX accepts orders beginning at 2:30 a.m. ET. While the continuous and after-hours trading sessions liquidity profiles by time have remained constant, early hours trading shows consistent year-over-year growth since 2019. In 2024, early hours trading made up 0.27% of all TCV in just the first 30 minutes of trading and is on track to nearly double in 2025. While trading during early trading hours has shown consistent growth, after hours trading has remained flat. The proportion of trades executed during the first half hour after market close has remained at approximately 3% of TCV.

^{Source: Cboe Internal Data}

Looking at the chart below, EDGX message counts by time-in-force are in-line with the early trading hours trend on passive orders where most orders are entered right at 2:30 a.m. ET and the message counts then decrease over time. This suggests that there may be day orders queuing up prior to 2:30 a.m. ET and there may be additional demand if order acceptance was extended earlier. An extended DAY order, also referred to as PTX, is a DAY order that is eligible from the beginning of the pre-market trading session to the end of the post-market session.

On the other hand, Immediate-Or-Cancel (IOC) orders come in right at 4:00 a.m. ET and then decline before stabilizing in half an hour and increasing to a peak stream for the rest of the period.

^{Source: Cboe Internal Data}

As shown in the chart below, continuous book executions are heavily concentrated right at the start of regular hours trading, with orders entered before 7a.m. making up 3.5% of the volume in the first half hour of regular hours trading (9:30 a.m. – 10 a.m. ET) so far this year. Extended day orders consistently make up more than 95% of the early order volume that trades on EDGX.

^{Source: Cboe Internal Data}

Retail Participation in Early Hours Trading

One of the key components of EDGX’s offering is the strong inflow of retail attested orders participating in the early hours of 4 a.m. – 7 a.m. ET. Since 2024, the growth of retail trading has had a pronounced effect, now comprising more than half of EDGX’s increasing premarket share.

^{Source: Cboe Internal Data}

Volume Drivers in Early Hours Trading

An increasing portion of premarket volumes are exchange traded funds (ETFs) and sub-dollar securities. Sub-dollar securities grew from 5% of premarket volumes at the beginning of 2023 to almost 20% by the end of 2024 and ETFs increased from 8% to almost 25% in the same timeframe. Additionally, ETFs made up between 40% - 50% of notional value traded during this period.

^{Source: Cboe Internal Data}

Top 10 Securities in Early Hours Trading

In early hours trading, the top 10 securities traded consistently make up at least half of the notional value traded in the session. The top 10 names fluctuate day-to-day, but from January 2024 through March 2025 the top corporate stocks traded were Tesla (TSLA), Nvidia (NVDA), Alibaba Group (BABA), Palantir (PLTR) and Super Micro Computer Inc. (SMCI). The top ETFs were Invesco QQQ Trust, Series 1 (QQQ), iShares Short Treasury Bond ETF (SHV), SPDR S&P 500 ETF Trust (SPY), ProShares UltraPro QQQ (TQQQ) and Direxion Daily TSLA Bull 2X Shares (TSLL).

^{Source: Cboe Internal Data}

The Future of Extended Trading Hours

As investors adapt to the ever-changing equities markets, Cboe continues to develop innovative solutions needed to support the growing demand for extended hours trading. Cboe has published an analysis of what it takes to offer 24x5 Trading and has announced its intention to offer 24x5 trading in National Market System (“NMS”) securities pending industry readiness and necessary regulatory approvals. As noted, Cboe already provides near 24x5 Global Trading Hours (GTH) for proprietary derivatives, providing a model for how around-the-clock equities trading could operate in the future.

Additionally, Cboe will introduce early hours trading on its BZX Equities Exchange (BZX^®) on May 1, 2025, providing two exchanges for traders to access U.S. equities between 4 a.m. – 7 a.m. ET. Abroad, Cboe’s presence in Asia Pacific and globally consistent, locally optimized approach serve as powerful resources for clients who can benefit the most from early hours trading in the U.S. Until trading is available during APAC daytime hours, investors in the region have access to Cboe’s robust U.S. equities market data, enhancing market understanding and providing insight. For questions about how to access extended trading hours on our markets, please reach out to your Cboe representative.

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