First 24/7 US Stock Exchange Approved by SEC
A new startup stock exchange, 24X National Exchange, has received approval from the Securities and Exchange Commission to operate for 23 hours a day, five days a week. This means that traders will have the option to participate in trading sessions both during the US daytime and overnight.
The exchange, backed by Steve Cohen’s Point72 Ventures fund, aims to meet the demand from investors who seek more flexibility to respond quickly to news outside of regular US market hours. However, this proposal has sparked a debate within Wall Street, with some arguing that lower trading volume during overnight hours could impact trading quality and pricing accuracy.
Dmitri Galinov, the founder and CEO of 24X National Exchange, expressed excitement about the SEC’s approval, highlighting the potential benefits for traders who are at a disadvantage when markets are closed in their time zone. The exchange plans to offer three sessions starting at 4 a.m. in New York and extending until 7 p.m. Additional overnight trading may be added from 8 p.m. to 4 a.m. once certain data requirements are met.
The approval of 24X National Exchange comes at a time when overnight trading is becoming more prevalent, owing in part to platforms like Robinhood Markets Inc. and Interactive Brokers Group Inc. offering 24-hour trading on their alternative systems. In response to this trend, the New York Stock Exchange has submitted its own application to extend trading hours during weekdays.
While the expansion of trading hours may provide increased flexibility for some investors, consumer advocacy group Better Markets has expressed concerns about potential risks to retail investors trading during overnight sessions. They argue that limited liquidity during these times could result in more volatile and less favorable prices, potentially leading to losses for traders compared to trading during regular market hours.
