The world’s biggest stock exchange is running a survey to see what market players think about trading stocks around the clock. The question, posed by the New York Stock Exchange’s data analytics team, raises an idea that would be momentous—but also vaguely quaint and ridiculous. After all, it’s been possible to engage in nearly every form of commerce, from booking plane tickets to placing prescriptions, 24 hours a day for many years now.
Stock exchanges, however, have hewed to a very analog definition of business hours. In the case of the NYSE, this means literally ringing a bell at 9:30 a.m. ET to start trading and then ringing it again at 4 p.m. to stop. In recent years, the exchange has also facilitated after-hours trading from 4 p.m. to 8 p.m. via ECNs, or “electronic communication networks.” The whole regime has a very 1998 vibe to it.
The people who run stock exchanges are hardly stupid or backwards, of course—nor are the institutional traders who make up the bulk of their trading. And there are reasons to set defined market hours such as concentrating liquidity and ensuring there is adequate staffing to consolidate the official trading records. Nonetheless, even the biggest institutions can’t hold off the forces of technology forever, and that—along with requests from a Steve Cohen-backed startup to launch a 24/7 exchange—is spurring NYSE to reconsider. As the Financial Times, which first reported on the survey, observes:
The issue has become a hot topic in recent years, prompted in part by the 24/7 operation of cryptocurrency trading and the rise in retail investor activity first spurred by coronavirus pandemic lockdowns. Stock exchanges have become something of a laggard in a world where other big markets, including U.S. Treasuries, major currencies, and leading stock index futures, can be traded around the clock from Monday to Friday.
The FT also points out that Robinhood and other newer brokerages have been using dark pools or their own inventories to offer their customers something like 24/7 trading. Meanwhile, there may also be a policy case for the NYSE to go to round-the-clock trading: Keeping the market closed for hours or days at a time expands credit risk and can create big market lurches after major weekend or late-night events.
Others might counter that the NYSE’s current rules provide an opportunity for everyone to take a collective breath between trading frenzies, leading to better trading decisions. There are also intangible benefits to the current regime like the charm and ritual of ringing the opening bell (it’s fun!), and that everyone—especially in America—would benefit from working and trading a little less.
One final note: If you share my interest in the future of stock exchanges and the finance industry more broadly, I invite you to join me, Leo Schwartz, and other colleagues from Fortune at the Future of Finance: Technology and Transformation summit at the Park Hyatt in New York on May 16. We will be speaking onstage with senior executives from leading firms like BlackRock, Robinhood, PayPal, and Accenture, and with influential political figures like Anthony Scaramucci and New York State Department of Financial Services superintendent Adrienne Harris. Details here.
Jeff John Roberts
jeff.roberts@fortune.com
@jeffjohnroberts
DECENTRALIZED NEWS
Two SEC lawyers resigned after facing termination over their misconduct in a crypto case where they lied to obtain emergency orders. (Bloomberg)
A new AI startup called Prime Intellect raised $5 million from CoinFund and others to build an open-source research platform powered by decentralized computing. (Fortune)
Bitcoin ETFs saw a second straight week of net outflows, which a report attributed to investor anxiety over the Fed’s lack of movement on interest rates. (Bloomberg)
Ripple asked a judge to reject the SEC’s proposed $2 billion fine over its sale of XRP to institutional investors, claiming the huge sum was part of “ongoing intimidation” against the U.S. crypto industry. (The Block)
Shares of crypto firms rallied on the first trading day following the halving. (Cointelegraph)
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