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Single-stock options now trade before the bell, and earnings week showed the catch

Cboe and NYSE opened pre-market and late sessions in options on the busiest stocks. Tesla and Meta results gave retail traders the first real test of what those extra hours offer.

· · 5 min read
Abstract illustration for: Single-stock options now trade before the bell, and earnings week showed the catch
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For as long as listed stock options have existed in America, a company reporting after the close has left option holders stranded. The shares could reprice within minutes on electronic venues, while the contracts written on them sat frozen until 9:30 the next morning. This week that changed for a short list of the most heavily traded names. On October 19th Cboe opened a pre-market session from 7:30 to 9:25 in the morning and a 15-minute window after the close, from 4:00 to 4:15 in the afternoon, for options on 24 single stocks and 5 exchange-traded funds. NYSE, owned by Intercontinental Exchange, began extended options hours of its own on the same day.

The timing was apt. Within three days, Tesla and Meta, two of the stocks most beloved by individual option traders, reported quarterly results after the bell on October 21st. Their earnings offered the first practical demonstration of what the new hours can and cannot do for the retail traders who now account for a large part of options activity.

What has changed

The Cboe list reads like a retail watch list. Alongside Apple, Amazon, Microsoft, Nvidia, Meta and Tesla it includes Palantir, Robinhood, Nokia, Intel, Micron, Alibaba and Pfizer, plus funds tracking the S&P 500 (SPY), the Nasdaq 100 (QQQ), the Russell 2000 (IWM), gold (GLD) and financial stocks (XLF). Eligibility is mechanical: an option class must average at least 150,000 contracts a day, the underlying company must be worth at least $50bn, and its shares must trade at least 10m a day. The exchange may admit up to 100 classes, and CNBC reported that the list is to be reviewed twice a year.

The selection is narrow by design but not small in effect. According to Cboe, options on these underlyings accounted for about 53% of average daily US-listed options volume in 2026 through September. The exchange has pointed to demand in its index options, which already trade almost around the clock: its pre-market session averaged a record 228,097 contracts a day last quarter, according to data the exchange shared with CNBC. Brokers including Fidelity, Interactive Brokers, Robinhood, Moomoo and TradeStation offer, or plan to offer, access.

Rules carry over sensibly. Cboe will not open an options class before its underlying stock has opened, and will generally halt the options when the stock halts.

A slow start, then earnings

Early activity was thin. On Monday, the first session, Tesla was the standout in the extended stock sessions with just over 3,000 contracts traded, nearly all of them calls, worth less than $100,000 in total, according to SpotGamma data cited by CNBC. That is a rounding error next to regular hours. On the afternoon of October 21st, before the results, Tesla options traded 520,000 contracts, of which 315,000 were calls, according to Cboe LiveVol data reported by CNBC. Market makers were pricing a 5.5% move in the shares after the report; for Meta the implied move was 6.5%. Short-dated contracts dominated: the most popular Meta contract was a call expiring that Friday, costing $1.40 and needing a 14% rally to pay off.

The results then did what results often do. Tesla beat forecasts with adjusted earnings of 48 cents a share and revenue of $28.05bn, yet its shares slid more than 3% in extended trading, CNBC reported, and by the following morning they were down 5.0% in pre-market trading at $367.20. Meta shares were also lower before the open.

Where the new hours help

For an option holder, that sequence is where the reform matters. Under the old regime, a trader long Tesla calls going into the report watched the stock fall through the evening and could do nothing with the option until the regular open, when the whole overnight move arrived at once. On October 22nd the same trader could, from 7:30, close or hedge the position while the stock was still finding its level, or buy protection before the crowd at 9:30.

Proponents argue that this smooths what professionals call jump risk. A fund manager quoted by CNBC put it as adding "more increments of time". There is a fair case that, for the stocks concerned, price discovery in options will now begin closer to the moment news breaks rather than being compressed into the opening auction.

Where it does not

The catch lies in the clock. The afternoon session closes at 4:15, while most large companies publish results around 4:00 and hold their conference calls later still. In practice, the post-close window is too short to absorb an earnings release, let alone the guidance discussed on a call. The real repricing therefore happens in the morning session, and only after the stock itself has traded overnight on equity venues.

Liquidity is the second issue. Pre-market stock trading is thinner than regular hours, and options market makers quote off that thinner market. Wider spreads are the likely result, and they would fall hardest on the small, short-dated orders that individual traders favour. Thin opening volumes in the first days suggest that, for now, much of the new session is a place to adjust a position rather than to find deep markets.

The third is behavioural. These sessions arrive at the peak of a short-dated boom. In its review of the third quarter, published on October 19th, Cboe reported that market-wide options volume averaged 70.6m contracts a day and that zero-days-to-expiry contracts reached a record 24.2m a day, about 36% of the total. Single-stock options averaged 32.7m contracts a day, down 8% from the second quarter, but retail order flow, Cboe said, rebounded to all-time highs in September. Giving that audience more hours in which to trade contracts that expire within days does not by itself make them better informed.

More hours are coming

The expansion is part of a broader march towards round-the-clock markets. Cboe plans to list additional morning expiries on November 9th, according to CNBC, and regulators have approved binary contracts tied to company-specific performance indicators. Both Cboe and NYSE intend to extend equity trading to 23 hours a day, five days a week, from December 6th; Cboe says its plan depends on industry readiness. Each step widens the window in which retail investors can trade, and each shifts more activity into sessions where fewer professionals are present.

Our view

Extended-hours options on the largest stocks are a sensible reform. It was always odd that an investor could sell Tesla shares at 8am but not the options written on them, and closing that gap gives holders of earnings-week positions a way out that previously did not exist. The first week, though, has shown that the benefit is narrower than the marketing suggests. The 15-minute afternoon window ends before most earnings calls, and the morning session runs on a thinner market than the one most traders are used to.

For individual investors, the useful lesson is about cost rather than access. A position that can be traded at 7:30 is not necessarily one that can be traded cheaply at 7:30. What to watch is whether volume in the morning session grows enough to narrow spreads, whether brokers show retail clients the difference between pre-market and regular-hours quotes clearly, and whether the next semi-annual review extends the list beyond the obvious giants. This article is analysis, not investment advice.

Sources

Filed under Investing. Written by Invest Times Editorial under our editorial standards. Commentary and analysis for information only, not investment advice.

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