3.3What is an opening price?
1What is it?
The opening price is the first price of the day, set in the 9:00–9:15 a.m. pre-open session.
2Why does it exist?
Overnight news (results, global markets) is absorbed at the open. Comparing open with previous close shows how the market reacted.
3Stock market example
During pre-open, orders are collected for about 8 minutes, and the exchange calculates the single price at which the most shares can trade. That becomes the open.
4Quick revision
- Open = first price of the day.
- Discovered in the pre-open session.
- Reflects overnight news.
5Knowledge check
Q1. When is the opening price discovered?Show answer
In the pre-open session, 9:00 to 9:15 a.m.
Q2. Why can the open differ from the previous close?Show answer
Overnight news and global markets.
Q3. What is the rule for choosing the opening price?Show answer
The price at which the most shares can be traded.
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