This chart made rounds last year, but it deserves a re-up:

During regular market hours (9:30am-4pm EST, M-F), markets have made basically zero gains since 1993. But outside of regular trading hours, meaning pre-market and after-market trading hours (4am-9:30am, 4pm-8pm), the market has gained nearly 600%.

This is an eye-opening chart.

So what does it tell us?

Two things:

  1. If you’re a day trader, you should be buying the close and selling the open in general. You’re more likely to see gains in the after-hours market.
  2. Buy and hold is the only way to capture all the gains in the market. Chances are, you’re not doing most of your trading after hours like the Big Dogs are. Retail investors are primarily buying during normal market hours. The only way to capture all the after-hours gains is holding long-term.

The Big Dogs trade in the after hours when there’s lower volume. It makes it much easier for them to move prices.

Additionally, overseas traders trade US stock futures overnight, because they’re awake when we’re asleep. Plus, earnings reports are released either pre-market or after-hours, and earnings are major drivers in price action.

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