Best Time to Trade Options: Avoid Rushing a Trade

Knowing the best time to trade options can make a big difference in your results. Is it right at the open, during midday, or in the final hour? How does this compare to when is the best time of day to buy stocks? We’ll look at timing, volume, and strategy.

Best time to trade options: understanding market behavior

The best time to trade options often comes when liquidity is high and volatility has settled, usually about one hour after the market opens. Traders watch for tight bid-ask spreads and active order flow, which make it easier to enter and exit at good prices. Implied volatility can shift quickly during the day, so timing matters. Many prefer:

• Morning, after the initial volatility surge.
• The final hour, when activity picks up again.

Spreads and price movement in options can differ from stocks, so knowing the best time of day to trade options helps match your strategy to market conditions.

The best time to trade options can depend on your style. Day traders often target the first hour for its high volume and volatility. Credit traders might prefer the last hour, when the day’s trend is clearer and adjustments are easier. Position traders may like midday, leaving orders in the market and waiting for a fill without constant noise.

When is the best time of day to buy stocks - and how it relates to options

The first hour after the open (9:30 - 10:30 AM EST) is often the best time of day to buy stocks, with high volume and strong moves. Stock and options volume align here, but for the best time to trade options, waiting a few minutes can mean tighter spreads. 

Equity momentum in that first hour often sets up early breakouts for either calls or puts, that you can easily spot on our screener for options trades. Matching stock trends with option entries helps improve timing and reduce cost.

Best time of day to trade options based on strategy

Scalpers and intraday traders often see the best time to trade options as the market open and the power hour, when liquidity and volatility are high and spreads are tighter. Swing traders may review setups during midday but usually wait for clearer moves. Liquidity and bid-ask spreads can change fast, so timing matters. Price action and implied volatility help guide entries:

• Use breakouts or reversals for quick trades.
• Look for low spreads before entering.
• Match IV to your strategy: high IV for selling options, low IV for buying them.

Strategy choice should match the market’s rhythm.

Best time of day to buy stocks vs options: key differences

Stocks often move early on news or earnings, making the first hour the best time of day to buy stocks. For the best time to trade options, patience matters since spreads can be wide at the open and there’s no pre market. Watch the options chain, wait for tightening, and avoid chasing the first move.