SEC Approves 24/7 Trading for Startup Exchange: Traders Caution on Risks
A startup stock exchange has just received the green light from the US Securities and Exchange Commission to introduce extended trading hours. This means they can now operate for a 23-hour session five days a week. The exchange, called 24X National Exchange and backed by Steve Cohen’s Point72 Ventures, will initially run trading from 4 a.m. to 7 p.m. ET. They plan to add overnight trading from 8 p.m. to 4 a.m. once certain data requirements are met.
This move is a big deal for 24X, as it opens up more chances for investors to react to news outside of the regular U.S. market hours. Dmitri Galinov, the CEO and founder of 24X, expressed his excitement about the SEC’s approval, calling it a “thrilling development.” He pointed out that traders are most vulnerable when the market is closed in their geographical location.
Interest in after-hours trading has been on the rise, especially since the pandemic hit. Companies like Robinhood Markets Inc. and Interactive Brokers have already been offering 24-hour trading on alternative platforms like Blue Ocean’s trading system.
However, some market participants are cautioning against the risks of reduced liquidity during off-hours. Better Markets, a consumer advocacy group, has expressed concern that overnight trading could harm investors. They argue that retail investors trading during overnight sessions may face fewer buyers and sellers, leading to more volatile and less favorable prices compared to normal business hours.
Despite these concerns, the SEC’s recent approval follows a move by the New York Stock Exchange to extend its trading hours to 22 hours a day. Stay tuned for more updates as this story continues to unfold!
