How to Trade Pre Market on Robinhood

Are you looking to get a head start on your trades by trading before the market officially opens? Robinhood, a popular commission-free trading platform, offers its users the ability to trade during the pre-market session. In this guide, we will walk you through how to trade pre-market on Robinhood and provide some tips to help you make the most of this early trading opportunity.

What is Pre-Market Trading?

Pre-market trading, as the name suggests, is the period before the stock market opens for regular trading. During this time, traders can place orders to buy or sell stocks and ETFs, just like they would during regular market hours. However, it's important to note that pre-market trading typically has lower volume and liquidity, which can lead to wider bid-ask spreads and increased volatility.

How to Enable Pre-Market Trading on Robinhood

Before you can start trading pre-market on Robinhood, you need to ensure that your account is eligible for this feature. Not all brokers offer pre-market trading, so it's essential to check if your account has been granted this privilege. Here's how you can enable pre-market trading on Robinhood:

1. Open the Robinhood app on your mobile device or visit the website on your computer.
2. Go to the settings menu and select 'Account.'
3. Scroll down to 'Account Information' and look for the 'Account Type' section.
4. If your account is eligible for pre-market trading, you will see an option to enable it. Simply toggle the switch to turn on pre-market trading.

Placing Pre-Market Orders

Once you have enabled pre-market trading on your Robinhood account, you can start placing pre-market orders. Here's how you can do it:

1. Open the Robinhood app or website during pre-market hours (usually between 4:00 am and 9:30 am EST).
2. Search for the stock or ETF you want to trade and select 'Trade.'
3. Choose whether you want to place a market order or a limit order.
4. Enter the quantity of shares you wish to buy or sell.
5. Review the order details and submit your pre-market order.

Tips for Successful Pre-Market Trading

Trading during the pre-market session can be advantageous, but it also comes with its own risks and challenges. Here are some tips to help you navigate pre-market trading on Robinhood successfully:

• Do Your Research: Before the market opens, make sure to research the stocks you're interested in trading. Look for any news or events that could impact their prices.

• Set Realistic Expectations: Pre-market trading can be more volatile than regular trading hours. Set realistic goals and be prepared for increased price fluctuations.

• Use Limit Orders: To mitigate the risks of wide bid-ask spreads, consider using limit orders instead of market orders during pre-market trading.

• Monitor Your Trades: Keep a close eye on your pre-market trades and be ready to adjust your strategies if needed. Pre-market conditions can change rapidly.

By following these tips and guidelines, you can enhance your pre-market trading experience on Robinhood and potentially capitalize on early trading opportunities. Remember to always trade responsibly and stay informed about market conditions to make informed decisions.

In conclusion, trading pre-market on Robinhood can be a valuable tool for active traders looking to get ahead of the market. By enabling pre-market trading on your account, understanding the risks involved, and following best practices, you can make the most of this trading opportunity. Good luck and happy trading!