# Understanding the NYSE Opening Bell: Significance, Function & FAQs

## What Is the Opening Bell?

The opening bell refers to the moment a securities exchange opens for its normal daily trading session. The time and conditions of the opening bell differ from one exchange to another. The most famous opening bell is the one used by the New York Stock Exchange to signal the start of trading.

Given the shift from physical to electronic trading, there is symbolic significance of the opening bell at the NYSE, where it turns into a ceremonious event with celebrities sometimes invited. The bell signifies more than just the start of trading, as it acts as a point for media coverage and adds heightened attention to the stock market activities.

### Key Takeaways

*   The opening bell marks the start of a trading session on an exchange, notably at 9:30 AM Eastern Time for NYSE and Nasdaq.
*   Although largely symbolic, the opening bell helps draw attention to market activities and allows exchanges to promote IPOs.
*   With the rise of electronic trading, physical trading floors have diminished, making the opening bell a more ceremonial event.
*   Pre-market trading occurs before the opening bell, involving limit orders only, and often sees lower liquidity and higher volatility.
*   While the forex market operates continuously without an opening bell, the NYSE and Nasdaq maintain the bell as a key ritual.

## The Significance and Function of the Opening Bell

Since 1985, the [New York Stock Exchange](https://www.investopedia.com/terms/n/nyse.asp) (NYSE) has used the opening bell to start its trading session at 9:30 a.m. Eastern time. At the NYSE, there is a physical bell and an automated ringer that sounds at the beginning of each trading day. On the Nasdaq exchange, where this is no physical trading floor, the opening of the market is referred to as the opening bell, but it is symbolic in significance.

Most physical [trading floors](https://www.investopedia.com/terms/t/trading_floor.asp) have vanished due to the rise of [electronic trading](https://www.investopedia.com/terms/e/ecn.asp). Investors and traders use the term opening bell to describe the opening of a given market. The physical ringing of the opening bell has become a ceremonious event where dignitaries visiting the stock markets or companies that are trading for the first day are given the honor of ringing the bell.

It draws attention to the day's trading activities and keeps investors interested. Because of this, media companies like CNBC, Fox, and Cheddar have set up on-location fixtures at the NYSE, one of the last well-known physical trading floors.  

Without media companies reporting on trading sessions, the exchange would struggle to justify keeping the trading floor open, as much of it is automated. Accordingly, the Nasdaq exchange, which was electronic from its inception, has no physical trading floor and has created a media space for the purpose of featuring its opening bell ceremonies.

The first bell was actually a large gong used on the NYSE to officially notify brokers and dealers that it was okay to begin the work of auctioning prices. However, in 1903, the gong was replaced by an electronically operated brass bell. The bell is accompanied by the gavel that is used in conjunction with the closing bell in recognition of 19 century stock calls.

> **Tip**
>
> The opening and closing bell can be viewed each day on the the New York Stock Exchange’s website.

The New York Stock Exchange and the Nasdaq Exchange open at 9:30 a.m. Eastern Time and close at 4:00 p.m. Eastern Time, but different exchanges all around the world open at different times of the day. For example, many [futures](https://www.investopedia.com/terms/f/futures.asp) markets have an opening bell followed by a morning and afternoon session. The [options](https://www.investopedia.com/terms/o/option.asp#:~:text=Options%20are%20financial%20instruments%20that,underlying%20securities%20such%20as%20stocks.&text=Call%20options%20allow%20the%20holder,price%20within%20a%20specific%20timeframe.) markets also tend to have different opening bells depending on the exchange. Traders should be aware of these times before trading in the market.

In the foreign exchange ([forex](https://www.investopedia.com/terms/f/forex.asp)) market, there is no opening bell since the market operates 24 hours a day, six days per week. The start of the trading day, however, is often considered to be 5:00 p.m. Eastern Time until the same time the next day.

> **Fast Fact**
>
> The original opening bell at the NYSE was a Chinese gong.

## Navigating Pre-Market Trading: Opportunities and Risks

Many exchanges offer [pre-market trading](https://www.investopedia.com/terms/p/premarket.asp) that occurs before the opening bell. During this time, traders and investors who have access to the extended session trading may place trades with one another.

But there are no market specialists or market makers during these hours, and trading is done with limit orders only. Trades must therefore be exact matches in terms of size and offer time. This means that trades made in these hours may take more time to fill and be less efficient in their pricing. As a result, fewer traders participate in such sessions.

Earnings announcements are a notable exception. If a company announces its quarterly results before the opening bell, then an unusual flurry of activity is likely to take place on that particular stock.

The added participants all rushing to make trades based on the new information means that trading in those moments can occasionally mimic the speed and efficiency of price action that a regular session might provide. This flurry of activity may also occur sporadically based on news that is released overnight or before the opening bell.

Despite its advantages, pre-market trading comes with important risks. Pre-market trading tends to have less [liquidity](https://www.investopedia.com/terms/l/liquidity.asp) than trading during regular hours, which means that [bid-ask spreads](https://www.investopedia.com/terms/b/bid-askspread.asp) may be wider and price action may be significantly more volatile.

Many pre-market and after-hours traders are also [institutional investors](https://www.investopedia.com/terms/i/institutionalinvestor.asp) trading in [mutual funds](https://www.investopedia.com/terms/m/mutualfund.asp) and [hedge funds](https://www.investopedia.com/terms/h/hedgefund.asp), which means that retail investors must compete with professionals who are better equipped to work their orders than the average individual investor.

Some markets, such as the forex and cryptocurrency markets, do not have an opening bell. Trading in these markets happens 24/7, every day.  

## What Time Is the Opening Bell on Wall Street?

The New York Stock Exchange rings the opening bell at 9:30 AM every day, except weekends and holidays. The Nasdaq opens at the same time, but as an automated market the bell is purely ceremonial.

## Why Does the Stock Market Ring the Bell Every Opening and Closing?

The opening and closing bells on the stock market tell traders when they are allowed to start or stop trading. In early stock markets, this role was played by a gavel. In today's world of automated markets, the bell is less important, but it still plays a symbolic role.

## Why Do They Clap at the Opening Bell?

The opening bell is an important symbol of the success of the stock market under capitalism, and the privilege of ringing it is often reserved for celebrities or VIPs. Traders often applaud when the market opens, particularly if the person ringing the bell is someone famous or highly accomplished.

## What Time Is the Opening Bell for the Nasdaq?

The Nasdaq opens at 9:30 AM on weekdays. Although trading is automatic, the opening bell ritual has strong symbolic importance. Many business people see an opportunity to ring the bell as a chance to build their brands and highlight their companies.

## How Do I Find Out Who Rang the Opening Bell Today?

The New York Stock Exchange has a Bell Calendar that lists the people who are invited to ring the opening bell every day. Other stock exchanges may have their own bell calendars as well.

> **Article Sources**
>
> 1.  New York Stock Exchange. "[History of the Bell](https://www.nyse.com/the-bell/history)."
>     
> 2.  NASDAQ. "[Bell Ringing Ceremony](https://www.nasdaq.com/marketsite/bell-ringing-ceremony)."
>     
> 3.  New York Stock Exchange. "[Bell Calendar](https://www.nyse.com/bell/calendar)."