US Stock Basics - Trading System

Let's take a detailed look at the characteristics and system of the US stock market.
We will focus in particular on what beginner stock investors are likely to be curious about.

1. Overview of the US stock market
The US stock market is the largest stock market in the world. Unlike Korea, companies from a wide range of industries are listed there.
Major exchanges include the New York Stock Exchange (NYSE), NASDAQ (NASDAQ), and the American Stock Exchange (AMEX).

2. A trading method different from Korea's
The biggest difference is the trading method.
In the Korean stock market, you place buy/sell orders before the market opens, and actual trades take place only while the market is open. The US stock market, however, is a bit more flexible.
US regular trading hours are 09:30 ~ 16:00 <US local time>.
In addition to regular trading hours, there are the 'pre-market' and the 'after-market', where trading can continue.
The pre-market is a market where trades take place before regular trading, and the after-market is a market where trades take place after regular trading.

Converted to <Korean time>, the trading hours are
- Pre-market: 18:00 ~ 23:30
With daylight saving time 17:00 ~ 22:30
- Regular hours: 23:30 ~ 06:00
With daylight saving time 22:30 ~ 05:00
- After-market (Post): 06:00 ~ 09:00
With daylight saving time 05:00 ~ 08:00

In other words, the US stock market allows trading almost 24 hours a day. Investors can buy and sell stocks at any time, even outside regular trading hours.
However, price movements in the pre-market or after-market are not reflected in the base price for the next day's regular trading session.
For example, suppose a stock rose 5% in the after-market. But when the next day's regular trading session begins, trading takes place at a new price based on the closing price of the previous regular session.
Regular trading hours run from 9:30 a.m. to 4:00 p.m. US Eastern local time. Converted to Korean time, that is from 10:30 p.m. to 6:00 a.m. the next day. During the regular trading year, there are about 10 market holidays per year and 3 early-close days.

3. Stock price volatility
Another feature of the US stock market is that stock price volatility is very high. Unlike Korea, there are no upper or lower price limits.
A stock price can rise or fall by tens of percent in a single day. When such sharp swings occur, a 'circuit breaker' system kicks in, as in Korea, temporarily halting trading.
As you can see, the US stock market differs from Korea's in many ways. It is important to understand its overall characteristics well, including the trading method, trading hours, and stock price volatility.