On Tuesday, shares of online broker E*Trade (Nasdaq: EGRP) soared 3-3/8 to 30-1/4 — a gain of more than 12.5 percent. This move followed the company’s announcement of an agreement in principle with Instinet to offer after-hours trading.
Starting in September, E*Trade plans to allow its customers to trade from 4 p.m. to 6:30 p.m. east coast time. Standard commission rates will apply, with E*Trade maintaining all customer accounts and support associated with the after-hours program
E*Trade’s announcement is the latest sign that the era of online trading is upon us. E*Trade competitor Datek already offers after-hours online trading, and online investment bank Wit Capital recently announced that it will be a founding partner for AOL’s forthcoming “After Hours Center,” which is expected to launch in November. You can expect more online brokers to enter the market soon. It remains to be seen, however, if there will be enough investor interest to justify all these players getting into the game.