How to Do Pre Market Trading on TD Ameritrade

Are you looking to get a head start on your trades before the stock market officially opens? Pre-market trading can offer unique opportunities for investors, but it's important to understand how it works and the potential risks involved. In this article, we will walk you through the steps of doing pre-market trading on TD Ameritrade, one of the leading online brokerage platforms.

What is Pre Market Trading?

Pre-market trading, also known as extended-hours trading, allows investors to buy and sell stocks before the regular market session begins. This extended trading period typically takes place between 4:00 a.m. and 9:30 a.m. Eastern Time, before the New York Stock Exchange and NASDAQ open for regular trading at 9:30 a.m. Pre-market trading can provide opportunities to react to overnight news or events that may impact stock prices.

Benefits of Pre Market Trading

One of the key benefits of pre-market trading is the ability to react quickly to breaking news or events that occur outside of regular trading hours. For example, if a company reports better-than-expected earnings before the market opens, investors can take advantage of this information and adjust their positions before the stock price reacts during regular trading hours. Additionally, pre-market trading can help investors manage risk by allowing them to set limit orders or stop-loss orders before the market opens.

How to Do Pre Market Trading on TD Ameritrade

Now that you understand the basics of pre-market trading, let's walk through how to place pre-market trades on TD Ameritrade.

Step 1: Check Eligibility

Not all stocks are available for pre-market trading on TD Ameritrade. Before placing a pre-market trade, make sure that the stock you are interested in is eligible for pre-market trading. You can find this information on the TD Ameritrade website or trading platform.

Step 2: Enable Pre Market Trading

To enable pre-market trading on your TD Ameritrade account, you may need to adjust your account settings. This can typically be done through the platform's settings or preferences menu. Follow the prompts to enable pre-market trading on your account.

Step 3: Place Pre Market Order

Once pre-market trading is enabled on your account, you can place pre-market orders through the TD Ameritrade trading platform. Simply enter the stock symbol, specify the number of shares you want to buy or sell, and select the order type (e.g., market order or limit order). Review and confirm your order before submitting it.

Step 4: Monitor Your Pre Market Trades

After placing your pre-market order, it's important to monitor your trades closely, especially as the regular market open approaches. Keep an eye on any news or events that may impact your position and be prepared to adjust your strategy if necessary.

Pre-market trading on TD Ameritrade can be a valuable tool for active traders looking to capitalize on early market movements and news events. By following the steps outlined in this article and staying informed about market developments, you can make the most of pre-market trading opportunities on TD Ameritrade. Happy trading!