What actually happens when you hit buy

A share is a small piece of a company. An order is what you send when you hit buy: how many you want and at what price. It joins a public list sorted by price and matches when someone accepts that price. Then one or two days pass before those shares are genuinely yours.

How buy and sell orders get matched

An exchange is a market where buy and sell orders match on their own, with nobody deciding the price. Behind every price you see there's a list with two columns, the same in practically every exchange in the world: the order book.

On the left, everyone wanting to buy, from the highest price they'll pay down. On the right, everyone wanting to sell, from the lowest up. The system matches them the moment they meet.

With numbers: imagine 200 shares waiting to buy at €49.90 and 150 waiting to sell at €50.00. Nothing matches, because nobody will pay what the other side is asking.

If someone arrives willing to pay €50.00, they take all 150 sitting at that price at once. The next ones cost them more, because the next price on the list is higher up.

That 10-cent gap between the two columns (50.00 minus 49.90) is paid by you. You buy at €50.00 and change your mind a second later: to sell, the best on the other side is €49.90. You've lost 10 cents a share without the price moving at all; on 100 shares, €10.

Notice that you made two trades there: you bought at €50.00 and you sold at €49.90.

Those 10 cents get split between the two people who were on the other side, the one who sold to you and the one who bought from you. It gets a lesson of its own later, in what every trade really costs you.

What an exchange is, beyond the list

An exchange is a regulated and supervised market, and that isn't red tape: it's what lets you buy from a stranger you know nothing about. Someone makes sure the matching rules are identical for everyone and that prices get published.

Someone also makes sure that listed companies, meaning the ones with their shares on sale there, disclose what they must. And that cheating can be pursued.

In Spain that supervisor is the CNMV (Comisión Nacional del Mercado de Valores, the Spanish securities regulator); in the United States, the SEC (Securities and Exchange Commission).

And "securities" is the collective name for shares, bonds and everything else bought and sold on a market: it is where the CNMV gets its name.

In a private sale two parties agree the price and nobody polices it. On an exchange you trust the mechanism, not the person on the other side.

It's a difference you notice most when it's absent. There are websites and apps offering to invest your money with no supervisor's permission at all.

The CNMV warns about unauthorised platforms because, in its own words, investing through them "carries a high risk of losing your capital, since they operate outside the controls set by the supervisory bodies".

Our own view is that something more basic sits underneath that: without supervision, there's no way to know whether the price you're shown is real or whether your orders match against anyone at all.

Who you're buying from: the company or another investor

Almost always, you're buying from another investor, not from the company. The primary market is the only moment the company gets paid: when it issues new shares and sells them. Everything after that is the secondary market: this is the second-hand market for shares, where money changes hands between investors.

Going public means putting a company's shares on sale on a market for the first time. Take the listing of Digi, the Spanish telecoms operator, from the previous session again, because it shows both at once.

That day Digi sold new shares, which is what a primary offering is, and shares that already existed, held by its earlier owners.

The money from the new ones went into the company's account: primary market. The money from the rest went to those owners: secondary market.

From the day after, almost everything traded in that stock is secondary market. Trading, in market language, just means buying and selling.

Almost everything, not everything. A company that's already listed can run a capital increase years later: create new shares and sell them to raise money. The company is still the same one and there are now more shares splitting it between them, so each old share becomes a smaller piece, and that is called dilution.

That is primary market again, and that money does go into its account.

The consequence that surprises people. When a stock's price rises 20%, the company doesn't receive an extra euro: that money changes hands between investors.

That's why an exchange is above all a second-hand market, and that is where its usefulness comes from: it gathers in one place a lot of people buying and selling that same share, so whoever wants to get rid of one doesn't have to go looking for a buyer on their own.

How many are on the other side, and how fast they show up, depends on the share. Further down there's a case where showing up takes hours.

The NYSE (New York Stock Exchange) and Nasdaq, the two big US exchanges, and the Madrid exchange, the main market of the Spanish exchange, all work this way.

How long it takes before the shares are yours

An order is "filled" when it has matched against someone else's, and your screen says so within a second. Being filled doesn't mean you have the shares yet: what you own at that moment is the right to receive them.

First comes a process called settlement: a clearinghouse (the firm that stands in the middle and answers for the trade if one side fails) certifies it, and one or two business days later the shares pass into your name.

Business day means a day the exchange is open: weekends and holidays don't count. The exact timings, which are changing right now:

• The United States settles in one business day since May 28, 2024, by decision of the SEC and the DTCC (Depository Trust and Clearing Corporation), the firm that settles almost every US stock trade. That is T+1: the T is the day you trade, and the number is the business days still to go.
• Spain and the rest of the European Union still settle in two business days, T+2. The move to T+1 is already approved under Regulation (EU) 2025/2075 and applies from October 11, 2027.

Volume is the amount that changes hands in a given period. And a central securities depository is the register that records who owns each share.

More than €4 trillion in securities settle every day in the European Union's central securities depositories, per the note on T+1 settlement the European Commission published in February 2025.

For you as an individual investor, this is almost invisible: the broker, which is the company you buy and sell through, handles it without you doing anything.

It only shows up in one case: cash from a sale isn't available to withdraw from your broker until the trade settles, because until that day the broker hasn't collected it either.

Withdrawing it, no; spending it again on the market the same day, almost always yes. Almost always and not always: that one isn't a rule of the system, each broker decides.

Who's on the other side of your trade

There's almost never a person deciding in real time on the other side. What usually happens is your order matches against a fund (a pot where many people put money together and someone decides what to buy with it), against a bank, or against an automated program.

Market makers, the reason someone is always there

A market maker is a firm that quotes a price it will buy at and another, slightly higher, that it will sell at, almost all the time.

It earns that gap: the same 10 cents from earlier, thousands of times a day. Without them, selling a thinly traded stock could mean waiting hours.

Who owns the market and who trades it aren't the same thing

Owning is how many shares you hold; trading is how many you buy and sell, and that is what volume measures.

Two figures people mix up, both on the US market, each with its own measurer:

• Ownership: institutional investors (pension funds, mutual funds, insurers) hold 69% of US listed shares, measured by value and as of end-2024. That's 69 out of every 100 dollars of the US market. The figure comes from the Corporate Governance Factbook 2025 of the OECD (Organisation for Economic Co-operation and Development), which compiles comparable economic statistics for the world's richer countries, and worldwide that share drops to 47%.
• Daily volume: individuals moved 21% of US traded volume on average between January and mid-May 2025, with a record 36% on April 28 and 29 of that year, per the tracker published by the US bank JPMorgan.

What share of the market automated programs move

High-frequency trading means programs that buy and sell in fractions of a second, capable of sending and cancelling thousands of orders.

They moved around 55% of US equity volume, per the estimate cited by the US Congressional Research Service in its April 2016 report on high-frequency trading.

That snapshot is from 2016; the two figures above are from 2024 and 2025.

That isn't necessarily bad for you. Among those programs there are automated market makers: the same thing that posts a buy price and a sell price at once, only written in software.

There is one figure for their size, measured separately: the firms that execute individuals' orders away from the exchanges moved 34% of US volume in June 2025, per the electronic market MEMX (Members Exchange).

And a study by three researchers, Hendershott, Jones and Menkveld, published in 2011 in the Journal of Finance found that automated trading narrows the gap between the buy price and the sell price, especially in large companies. You pay that gap.

Four figures have come up and none of them adds to another. The 69% is ownership: of all the money sitting in US shares, how much of it is in institutional hands.

The other three are volume, meaning movement, and each counts whose hands it passes through: the 21%, individuals; the 55%, high-frequency programs; the 34%, the firms that execute individuals' orders away from the exchanges.

Three different bodies measure them, each with its own definition, so these numbers alone can't tell you how much the 34% overlaps the 55%.

That they overlap is certain: every trade has a buyer and a seller, so one trade can count in two of those three at once.

What you are missing is speed. On the other side there are often professional systems that have already processed the public information, and that speed is not something anyone matches from a phone.

The context can be prepared beforehand, though: what day the company you follow reports, what is expected of those numbers, and how its price moved the previous times. That's what Volatly does: it writes it down before the figures come out.

Market hours, and what changes outside them

"Wall Street" isn't an exchange: it's the nickname for the whole US market, after the New York street where the NYSE stands. Wall Street runs from 9:30 AM to 4:00 PM Eastern Time, and those are the regular session hours published by both the NYSE and Nasdaq.

The Spanish exchange, 9:00 to 17:30 Spanish time, with an auction before and another after: stretches when orders pile up and none of them execute. You can trade outside those hours too.

How the Spanish exchange opens and closes

The open session on SIBE (Sistema de Interconexión Bursátil Español), Spain's trading system, runs 9:00 to 17:30 Spanish time, per the market model published by BME (Bolsas y Mercados Españoles), the company that operates the Spanish exchange. Every time in this section is Spanish time. Open session means orders match one by one as they arrive.

Before that, from 8:30 to 9:00, there's an opening auction: orders can be entered, changed, or cancelled, but none execute until the very end.

That end is set by a random close of up to 30 seconds. The rule is the same for every SIBE auction, per BME, even though the instant drawn is different every time.

That close fixes the opening price by matching all compatible orders at once. From 17:30 to 17:35 the same happens to set the day's official price.

Random means it doesn't finish at 9:00:00 sharp: the system draws a moment somewhere between 9:00:00 and 9:00:30. That draw stops the most nervous seconds of the day from being decided by whoever arrives first.

Volume isn't spread evenly through the day

There's a pattern that repeats on almost any exchange: activity is U-shaped.

Two researchers, Jain and Joh, measured it in 1988, hour by hour, across every New York Stock Exchange stock between 1979 and 1983, and a 2024 paper by Hua, Kong and Wang finds it again in Nasdaq stocks.

Activity concentrates heavily in the first half hour after the open and the last before the close, and drops noticeably through the middle of the session.

At the open, the market digests everything that happened since the previous close all at once. At the close, orders pile up from anyone who needs the day's official price, which only exists at the very end: whoever needs it can't trade earlier or later.

In that queue sits the index fund: a fund that picks no companies, it simply holds exactly the ones on a list another company publishes. The day the list changes, it has to change with it, whatever whoever runs it thinks.

When companies publish results, and what time that is in Spain

Each company chooses when it publishes its quarterly results, and over the years they have drifted towards publishing outside market hours, so the first reaction doesn't hit mid-session.

Three researchers, Michaely, Rubin and Vedrashko, studied it in 2014 using time stamps of announcements collected from newswires (the services that push news out to the media the moment it is released), and found a significant shift towards announcing outside trading hours.

When the announcement does land outside the session, it lands in one of two slots: after the US close, or before the open. The weeks of the year when those announcements bunch together are called earnings season.

Outside the regular session you can trade in two windows, Eastern Time: 4:00 to 9:30 in the morning, before the open, and 4:00 to 8:00 PM, after the close.

Those are the extended hours published by Nasdaq and by NYSE Arca, which is another market in the NYSE group. The main NYSE floor, the room in New York where people still trade face to face, has no extended session.

In those windows very few people sit on the other side, so it takes little to move the price.

To get a sense of it: in January 2025 all trading outside regular hours added up to a little over 11% of the shares changing hands in the United States, and less than half of that 11% happened after the close, per research the NYSE itself publishes.

The gap here is one of time zones, and it's purely geographic. The US close, 4:00 PM in New York, is 10 at night in mainland Spain for most of the year, six hours ahead, and an hour earlier in the Canary Islands.

The open lands in the middle of the Spanish afternoon.

That "most of the year" is three or four weeks short: the United States and Europe change their clocks on different dates, and in that window the close falls at 9 at night. One of those weeks, October 25 to November 1, 2026, is peak earnings season.

When you open your broker's app in the morning, the previous night's move has already happened and what you see is the outcome, with no context for what caused it.

What to remember

• Your order enters a public list sorted by price and matches when someone accepts the other side's price. The gap between the two columns is paid by you.
• An exchange is a supervised market: you trust the mechanism, not the person on the other side.
• You almost always buy on the secondary market: you're buying from another investor, and the company receives none of that money. It only gets paid when it issues new shares.
• The US settles in one business day since May 2024; Spain and the EU in two, until October 11, 2027.
• Companies have drifted towards reporting outside market hours: in Spain that lands at night or mid-afternoon.

Related: order types and how they execute · why earnings move the price so much · what a stock is and why a company goes public