After-hours trading refers to the buying and selling of stocks outside the regular trading hours of stock exchanges.
In India, the regular trading hours for equity markets are from 9:15 AM to 3:30 PM (IST) on the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE).
Any trading activity that occurs beyond these hours falls under after-hours trading
Types of After-Hours Trading in India
Unlike the US markets, where extended-hours trading (pre-market and after-market trading) allows transactions beyond normal market hours, the Indian market has a limited framework for after-hours trading:
1. Post-Closing Session (3:40 PM - 4:00 PM):
a. The stock exchanges allow a closing session for 20 minutes after the normal market closes at 3:30 PM.
b. Only market orders (orders at the closing price) are allowed.
c. No fresh price discovery occurs; trades happen at the closing price of the stock.
2. After-Market Orders (AMO)
a. Retail and institutional investors can place orders after market hours, but these orders are only executed in the next trading session.
b. AMO orders can be placed between 4:00 PM and 8:59 AM (next trading day).
c. AMOs do not guarantee execution because they enter the exchange order book only when the market opens.
d. Brokers may have different time slots for accepting AMOs.
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