Pre-market fluctuations

[normanicus]

Hello,

What do the pre-market fluctuations in share price mean? Why is there then such a wide difference between bid and offer? Is it actually possible to trade then?

I am talking of the LSE here,

Norman

 

[Rhody Trader]

The wide bid/offer is because the liquidity is very limited, so the market makers have to account for the greater risk they are taking of a rapid price move against them. As for what causes the fluctuations, there are numerous culprits. Economic data. Earnings. Geo-Political developments. Basically, anything that can impact the value of a company's shares.