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Schwab lures early birds
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August 16, 2000: 3:35 p.m. ET
Brokerage offering before-hours trading from 7:45 a.m.-9:15 a.m. ET
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NEW YORK (CNNfn) - Brokerage firm Charles Schwab Corp. said Wednesday it will offer pre-opening trading to investors starting Thursday, giving its customers the ability to swap stock before, during, and after the regular 9:30 a.m.-to-4:00 p.m. session.
 In a move that gives its clients more trading options, Schwab, one of the nation's largest financial services firms, said its U.S. retail customers and certain international clients will have a window between 7:45 a.m. and 9:15 a.m. to place limit orders for most Nasdaq and New York Stock Exchange securities.
During this "pre-market trading session," customers, perhaps in reaction to news released before the bell, would be able to trade as many as 5,000 shares of stock. Orders must be "limit orders," meaning the customer will have to put a limit on the amount, and the trades will be executed over the Redibook electronic communications network (ECN).
San Francisco-based Schwab, which also offers an after-hours trading session from 4:05 p.m. to 8:00 p.m. ET, is the latest in a growing list of brokers offering special features to meet customers' trading needs.
"Pre-market trading is a natural extension of our commitment to offering customers tools and information that enhance their trading experience," Lon Gorman, vice chairman of the Charles Schwab Corp., said.
Several online brokerages already offer before-hours trading, including Datek Online, which started its service in September 1999 via Island ECN. Fidelity Investments launched a similar service earlier this spring.
After-hours trade represents a small fraction of most investment firms trading activity, and before-hours dealings are far lighter, analysts say. With that in mind, they suggest the move by Schwab is rooted in its need to remain competitive, and to satisfy customers who have requested the option to make early morning trades.
"You are talking about perhaps one percent of overall volume is in pre-market," said Chase H&Q analyst Gregory Smith in San Francisco. "It's more about competitive positioning. As soon as one online broker offers it, the rest follow suit."
Trading during extended hours generally is handled by ECNs that simply match subscribers' buy and sell limit orders.
Shares of Schwab were steady Wednesday afternoon at 37-5/8, off 1/8 from Tuesday's close. 
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