The full form of AMO in the share market is After Market Order. Essentially, an AMO lets you place a buy or sell order for stocks once the regular trading session has ended.

This feature is especially useful for individuals who are unable to monitor the market or execute trades during standard trading hours due to their busy schedules. AMO ensures that your order is in place for the next trading session, making it convenient for those who want to plan ahead without having to engage in live, day-to-day trading.

How Does AMO Work?

Here’s how it operates: You place an AMO after the market has closed for the day. That order then sits in waiting and gets triggered when the market reopens the next day. For instance, if you submit an AMO in the evening, your broker holds onto it until the next day’s market begins. This gives you time to review your trading decisions after hours, making it ideal for those who prefer not to make spontaneous trades during the active trading session.

Benefits and Risks of AMOs

AMOs are a convenient tool, allowing you to participate in the stock market even if you can’t follow it during regular hours. It gives you the flexibility to manage your trades at any time without needing to adhere to the strict market schedule. AMOs are available across different segments like stocks, futures and options (F&O), currency, and commodities.

However, there are a few drawbacks to consider. Trading outside of regular hours often means lower market activity, which can lead to difficulties in fulfilling larger orders. Additionally, prices in after-hours trading may differ from those during standard hours, which can influence the outcome of your AMO.