After-hours trading refers to the buying and selling of stocks and other securities outside of the regular trading hours of major stock exchanges. While traditional trading hours are typically set between 9:30 a.m. and 4:00 p.m. in the United States, after-hours trading allows investors to trade securities after the market has officially closed.

After-hours trading provides an opportunity for investors to react to significant news events or earnings announcements that occur outside of regular trading hours. It allows for extended trading opportunities and increased flexibility. However, it is important to note that after-hours trading typically has lower trading volume and higher bid-ask spreads compared to regular trading hours, which can result in increased price volatility and risks.

After-hours trading is conducted through electronic communication networks (ECNs) and alternative trading systems (ATSs), which match buyers and sellers outside of regular exchange hours. It is important for investors to understand the rules and risks associated with after-hours trading, as it operates differently from regular market hours and may not always provide the same liquidity and price efficiency.