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Why do the markets close in this modern age?
Bazofts_Revenge
Posts: 299 Forumite
I get frustrated that I have to do my live trading in my lunch hour at work or in the dodgy 30 minutes between the markets opening and me starting work. Now everything is just about all done on computers apart from the professionals moaning they want to go home at 5 then why do they have to close. I know I could just trade in foreign markets like the USA on an evening but it is not a market I know that well apart from the usual household names.
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Comments
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Great question. Certainly isn't an IT problem.
Of course those open to out of hours trading and the market makers I suspect are happy to be able to play when we can't
Recently on another thread someone highlighted that many markets in Asia close for lunch so I guess we shouldn't complain or they may take away your lunch time trading as well :eek:I believe past performance is a good guide to future performance :beer:0 -
Why don't you just trade during your working hours, and do your own work in the remaining hours of the day? Nothing stops you from trading between around 8am and 4pm. Why do you expect the trading floor to be open 24x7 when you/the company you run/the company you work for are not?
You could, of course, always trade on exchanges in other time zones.0 -
get to know the US market - imo the US has always been more "private investor' friendly anyway - lots of coverage and so many companies to pick from!0
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It doesn't matter what time zone you're in.
Most trading, and hence price discovery, is done algorythmically these days. The market makers decide a price and let the computers trade all day and night until that price is reached.
Between this and "front-running" trades, the shadow banking system has got you screwed and any connection with the real economy was severed years ago.
Calling the stock market a casino is an insult to casinos.0 -
To provide a notional settlement period?"If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0 -
Often the FX markets are aligned to London times, when the market is likely to be most volatile.
Quite a few technical traders I know trade between the hours of 9-11am and 2-4pm. Outside these hours there can be little movement unless some big news story breaks.0 -
Have been digging and as I understand it the number one objection is liquidity.
The out of hours trading would be low volume and low volume can lead to volatility.
It also focuses on a limited range of stocks if you consider the trades from outside the region. The man in Hong Kong might be interested in buying shares in Shell but is less likely to be interested in Wigan Bus Company. And some stocks are restricted outside region.
It was thought in the early 90s to be the next thing and beyond the need for a few additional back office functions was easy enough to implement.
So I guess only when we become truely global will it be raised again.
ps: I do not work for or own shares in either Shell or Wigan Bus Company
:beer:I believe past performance is a good guide to future performance :beer:0 -
Just think what would happen if market prices were live at any time. Some major news event happens, and the markets react. If you as a trader don't want to lose out, you have to follow. Which means traders have to work 24/7. That means traders working shifts. That means employing 3x as many staff to do the same job. Which is more costs for everyone, and what do you gain?0
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Just think what would happen if market prices were live at any time. Some major news event happens, and the markets react. If you as a trader don't want to lose out, you have to follow. Which means traders have to work 24/7. That means traders working shifts. That means employing 3x as many staff to do the same job. Which is more costs for everyone, and what do you gain?
Or you just close out your positions at the end of the day. Or set up a stop and limit order and let the market do its thing.0
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