What is Pre-Open Market?
Learn everything about Pre-Open Market session
In this article, we will focus on "what is pre-open market?". Few of you may have heard about pre-open market and few of you may not have heard about pre-open market, may be you are a beginner in the trading. However it does not matter as in this article, you will learn everything that you need to know about "what is pre-open market?".
What is PRE-open MARKET SESSION?
Pre-open market session is a new innovation on the NSE and BSE exchange side to arrive at the ideal opening price of a stock for the current ongoing trading session.
The regular trading for Indian stock market opens at 9:15 a.m. and closes at 3:30 p.m. The Indian stock markets also open between 9:00 a.m. and 9:15 a.m. for a pre-open market session. In 2010, India began holding pre-open market sessions. This 15-minute session prior to the actual market opening aids in the stabilisation of volatility and unusual movement in the market as a result of major announcements like RBI Policy, Merger and acquisition announcements, credit-rating downgrades etc. The pre-open market session takes place for both NSE and BSE. Pre-Open market session is utilised to derive the ideal opening price of a stock for the subsequent regular trading session.
Pre-open market order entry session: From 9:00 AM to 9:07 AM (7 Minutes)
This session allows you to place a buy and sell order for stocks. Orders can be modified or cancelled. No orders are accepted after the first 7 minutes.
Pre-open market order matching session: From 9:07 AM to 9:12 AM (5 Minutes)
The exchange takes 5 minutes for order confirmation and order matching.
During this session, the opening price of stocks for the regular session is calculated. During this time, no orders can be bought, sold, cancelled, or modified.
Pre-open market buffer session: From 9:12 AM to 9:15 AM (3 Minutes)
This is referred to as the Buffer Session. It makes the transition from pre-open to regular market session easier.
The price band applicable for pre-open market session is 20%.
