What is a session price?
The term session price refers to the price of a Stock over the entire trading session, which is a variable period of time. The session price is also sometimes called the final price at the close of the session. The daily price data of a trading instrument usually includes the opening pricethe high price, the low price and the the last price as well.
Key points to remember
- The session price is the price of a stock during a trading session.
- It can also be used to describe the final price of a security at the end of the trading day.
- Historical prices usually list the price for each session of each day.
- Session prices can also refer to many other prices over a period of time, depending on the context.
Understand the price of the session
current or market value is determined by its price. This is the amount at which a company’s stock is trading per share at any given time. It is determined when a buyer and seller get together and agree on a price at which to make a Trade. When there are more buyers than sellers, the price goes up, and when there are more sellers than buyers, the price goes down.
The price of a stock has several components:
- The opening price or first price of a security at the start of the trading day
- The high and low price
- The closing price or price of a stock at the end of the trading session
As stated above, the session price of a stock is the price at which it trades during the trading session. It can also refer to a stock’s closing price – the stock price at the end of the day. The session price is a convenient way to determine the movement of stocks. They can also help analysts assess current and future performance. For example, a stock’s session price can be used to establish areas where there is support or resistance. It can also be used to identify overruns tendencies through the market.
You can use the session price to establish areas of support or resistance and to identify excessive trends in the market.
Since session is not a standard unit of measurement, the term session price usually indicates the session it refers to. For example, the term can be indicated as the opening session price or the session price range.
A session price can also indicate the price over a day, a week, a month or any other indicated period. It can also be seen used in descriptive examples saying that the session price was volatileor the session price remained stable throughout the trading period.
The New York Stock Exchange (NYSE) has standard trading hours, which are 9:30 a.m. to 4:00 p.m. EST. The first trade of the day sets the opening price and the final transaction will set the the last price. There are after hours transactions that can be made, but they can only be executed by electronic communication networks (ECN). These after-hours trades are separated into two markets.
The pre-marketing exchanges take place between 4:00 a.m. and 9:30 a.m. after hours market trading takes place from 4:00 p.m. to 8:00 p.m.These trades tend to have more volatility and less liquidity than those that take place during normal business hours. This is likely because trades that take place during these hours are considered unusual and potentially occur due to external factors and influences that can falsely inflate or deflate certain prices.
There are many reasons an investor may choose to trade outside of standard NYSE business hours. For some, this may be the only time they have. For others, there may be a market change that they try to anticipate or, on the contrary, to take advantage of. Whatever the reason, the market may revert to the prices of the previous day’s standard session, as opposed to the prices that were in effect during the alternate sessions, once standard operating hours begin again.