Overview of Major World Exchanges Trading Hours

Transcription

1 Overview of Major World Exchanges Trading Hours By Research & Corporate Development Department Major exchanges in Europe and the Americas have continuous trading sessions during the day while some Asia-Pacific exchanges, including Hong Kong, still retain a lunch break. Asia-Pacific exchanges tend to have extended trading hours for index derivatives. In November 2010, HKEx announced its decision to extend the trading hours of its securities and derivatives markets by one and a half hours in phases to March 2012, involving an earlier opening and a shorter lunch break. Phase 1 implementation was effected in March 2011, shortening the lunch break by half an hour and moving the morning session half-anhour earlier. Over the years, many overseas exchanges have extended their trading hours, while some have eliminated their lunch break or are considering doing so. As a result, the trading cycle of the global market is becoming longer. This article examines the securities and derivatives trading hours on major exchanges in comparison with HKEx. Key overseas exchanges are selected from the three major time zones: Asia-Pacific Australian Securities Exchange (ASX, including Sydney Futures Exchange (SFE)), China Financial Futures Exchange (CFFEX), Korea Exchange (KRX), Osaka Securities Exchange (OSE), Shanghai Stock Exchange (SHSE), Shenzhen Stock Exchange (SZSE), Singapore Exchange (SGX), Tokyo Stock Exchange (TSE); Europe Borsa Italiana (BI, part of LSE Group), Bolsas y Mercados Españoles (BME, Spanish Exchange), Frankfurt Stock Exchange (FWB, part of Deutsche Börse (DB) Group), Eurex Exchange (Eurex, part of DB Group), NYSE Euronext European exchanges (Euronext), London Stock Exchange (LSE), NASDAQ OMX Nordic Stockholm (Stockholm), NYSE Liffe of NYSE Euronext; Americas BM&FBOVESPA, CBOE Holdings Inc (CBOE), CME Group (CME), NASDAQ OMX US exchanges (NASDAQ), New York Stock Exchange (NYSE), TMX Group (TMX) in Canada. The trading hours are presented both in the local time of the selected exchanges (Figure 1) and in Hong Kong time (Figure 2) 1. The schedule in local time shows the opening hours of each market relative to its normal working hours. The schedule in Hong Kong time shows the round-the-clock trading cycle across different time zones. The analysis focuses on trading in equities and the more prominent equity-related derivatives (equity index or individual equity futures and options) on the selected exchanges. Key observations are noted on length of trading hours, equity trading hours compared with derivatives, extended hours and the global trading cycle. 36 Exchange July Status of trading hours information is as of early April 2011, obtained from the respective exchanges websites. Conversion to Hong Kong time is based on Daylight Saving Time (DST) in the West.

2 Figure 1 of key products of selected exchanges* in local time The bars colours mainly represent stocks ( ), index futures ( ), index options ( ) and stock options ( ). F&O = futures and options IOB DRs = Depositary Receipts on International Order Book SETS = LSE s flagship electronic order book * Excluding opening / pre-opening; including evening sessions / night trading / manual late trading / overseas trading / closing auctions / after-hours sessions / crossing sessions / pre-hours / extended hours ** Notes: ASX SPI 200 F&O: US DST Stock options: In the manual late trading and overseas trading sessions ( ), no bids or offers will be automatically matched. There is a one-minute market close between the two sessions (17:00 17:01). KRX KOSPI 200 futures: After-hours trading is effected by order routing to CME (18:00 05:00). KOSPI 200 options: After-hours trading is effected by trading futures on KOSPI 200 options from 16:00 04:00 (DST in Europe) on Eurex. NYSE Equities: Including a crossing session for trading of baskets of at least 15 NYSE securities (16:00 18:30) on the NYSE ( ), and extended hours (16:00 20:00) on NYSE Arca ( ) Stock/index options: Traded on NYSE Amex and NYSE Arca OSE Auction trading time TSE Auction trading time Index futures: After-hours trading for TOPIX Index futures is effected by trading from 15:00 05:00 (British DST) on NYSE Liffe ( ). 37 Exchange July 2011

3 Figure 2 of key products of selected exchanges* in Hong Kong time The bars colours mainly represent stocks ( ), index futures ( ), index options ( ) and stock options ( ). F&O = futures and options IOB DRs = Depositary Receipts on International Order Book SETS = LSE s flagship electronic order book * Excluding opening / pre-opening; including evening sessions / night trading / manual late trading / overseas trading / closing auctions / after-hours sessions / crossing sessions / pre-hours / extended hours ** Notes: For Europe and Americas, Hong Kong time conversion is based on DST for all markets except BM&FBOVESPA which is based on non-dst (for more or less the same period of months in the year). ASX Hong Kong time for ASX market is in non-dst in Australia, which goes along with the DST in the US and Europe for more or less the same period of months in the year. SPI 200 F&O: US DST Stock options: In the manual late trading and overseas trading sessions ( ), no bids or offers will be automatically matched. There is a one-minute market close between the two sessions (15:00 15:01). KRX KOSPI 200 futures: After-hours trading is effected by order routing to CME (17:00 04:00). KOSPI 200 options: After-hours trading is effected by trading futures on KOSPI 200 options from 15:00 03:00 (DST in Europe) on Eurex. NYSE Equities: Including a crossing session for trading of baskets of at least 15 NYSE securities (04:00 06:30) on the NYSE ( ), and extended hours (04:00 08:00) on NYSE Arca ( ) Stock/index options: Traded on NYSE Amex and NYSE Arca OSE Auction trading time TSE Auction trading time Index futures: After-hours trading for TOPIX Index futures is effected by trading from 14:00 04:00 (British DST) on NYSE Liffe ( ). 38 Exchange July 2011

4 Length of trading hours For equity trading, the longest trading hours in the respective time zones are on KRX in the Asia-Pacific (9 hours 50 minutes); on BI and FWB floor trading in Europe (11 hours); and on NYSE (via a subsidiary venue) in the Americas (10 hours 30 minutes). The European exchanges tend to have longer trading hours (8.5 hours or more) than exchanges in the Asia-Pacific and the Americas. The Mainland exchanges have the shortest hours (4 hours). For derivatives trading, different products on the same exchange may have different trading hours. Index derivatives usually have longer trading hours than stock options the exception being stock options on ASX where manual late trading and overseas trading sessions take the total trading day to 20 hours 59 minutes. The index derivatives products with the longest trading hours in each time zone are: in the Asia-Pacific, SPI 200 Index futures and options on ASX (20 hours 30 minutes); in Europe, FTSE 100 futures on NYSE Liffe (20 hours); and in the Americas, Standard & Poor s 500 Index (S&P500) futures and options on CME (23 hours). The normal trading session for the securities and derivatives markets of most exchanges in the Asia-Pacific and Europe starts at 9:00 am, while in the US and Canada exchanges it starts at 9:30 am. The equities and stock options of BM&FBOVESPA start trading at 10:00 am. The ASX equity market opens at 10:00 am local time. However, this is the same time as the Korean and Japanese market opening in the Asia-Pacific time zone, and is 1.5 hours earlier than HKEx and one hour earlier than SGX. Some derivatives markets start earlier than their regional peers CBOE in the US starts one hour earlier at 8:30 am; NYSE Liffe in Europe opens its stock options market one hour earlier at 8:00 am. The starting time also depends on the derivatives product concerned. For example, FTSE 100 futures on NYSE Liffe start trading at 1:00 am to serve Asian investors; Nikkei 225 Index (N225) products on SGX and EURO STOXX 50 Index futures on Eurex start earlier than other products on the same exchange. While exchanges in Europe and the Americas do not have a lunch break, some Asia-Pacific exchanges still have one the Hong Kong, Mainland and Japanese securities and derivatives markets (except Osaka s derivatives market which abolished the lunch break in February 2011) and Singapore s securities market. Prior to March 2011, Hong Kong s lunch break of two hours was the longest while the lunch breaks of the others were half-an-hour shorter. With the implementation of its proposed changes in trading hours, HKEx s lunch break was shortened to 1.5 hours in March 2011 and will be further shortened to one hour in March Equity market vs derivatives market For equity markets with a corresponding derivatives market on the underlying securities, trading in index derivatives usually starts slightly earlier than the equity market it does so on HKEx, the Mainland exchanges, ASX, SGX, the exchanges of DB Group and BM&FBOVESPA. Several markets, namely HKEx, the Mainland exchanges, ASX, KRX, OSE, TSE, BI, BM&FBOVESPA and TMX, end the trading in their index derivatives slightly later than their corresponding equity markets during the normal trading hours. Some markets start or end trading in equities and derivatives at the same time during the normal trading hours. KRX, OSE, TSE, BI, BME, Stockholm, NASDAQ, NYSE and TMX begin trading in their equities and index derivatives at the same time. BME ends trading in its equities and index derivatives at the same time. Compared with index derivatives, the trading hours of stock options are closer to those of their underlying equities. HKEx and BM&FBOVESPA have the same trading hours for equities and stock options. Although ASX, KRX, TSE, FWB/Eurex, LSE/NYSE Liffe, NASDAQ and TMX have different trading hours for equities and stock options, the differences are small, only a few minutes. This phenomenon may relate to the resources needed to operate the stock options market with its wide range of product series and to the trading strategies in stock options that involve trading in the underlying securities. 39 Exchange July 2011

5 Extended hours Some exchanges have trading hours extending beyond normal hours, either continuously from the regular session or as an extra trading session following the regular session. It is not common for equity trading to have extended hours. A few exchanges do have extended equity hours KRX, BI, FWB trading floor, BM&FBOVESPA and NYSE Arca (an electronic trading platform of the NYSE); but the extension is only a few hours into the evening, no later than 8:30 pm (on BI for liquid stocks only). Extended hours are not common for stock options. BM&FBOVESPA has extended hours for stock options to align with the hours for equities. ASX is an exceptional case, with extended normal, manual late trading and overseas trading sessions totalling about 15 hours for stock options. Many exchanges have extended trading hours for their index derivatives. These include all exchanges under study in the Asia-Pacific (except HKEx and the Mainland exchanges), Eurex and NYSE Liffe in Europe, and CME in the Americas. In some cases, the extended hours are even longer than the regular session the extended hours for ASX (SPI 200 Index futures and options), KRX (KOSPI 200 futures and options) 2, OSE (N225 products) and SGX (N225 products and MSCI Taiwan Index (MSCI TW) futures) are much longer than their corresponding regular session. In particular, the extended hours of ASX, KRX and SGX even span midnight and the trading of S&P500 futures and options on CME is almost round-the-clock (23 hours). Global trading cycle The afternoon hours of the markets in the European time zone cover the opening hours of the markets in the American time zone with an overlap of one to two hours. The Asia-Pacific markets, however, need to extend their trading hours to overlap with the opening of the European markets and to extend even more to overlap with the Americas (mainly the US). One rationale for this continuation or overlap is to provide as complete as possible a round-the-clock trading cycle for global investors. Another reason may be to compete directly with markets in other time zones for the global trading in their products. For equity trading, only BI and FWB floor trading have extended hours that overlap substantially with the US markets where the American depositary receipts, or ADRs, on their stocks are available for trading. The extended equity trading hours of KRX and SGX overlap with the European markets for about two hours. For index derivatives trading, ASX, OSE and TSE have extended hours overlapping to some extent with European hours. ASX, KRX, TSE and SGX have extended their trading hours through the European time zone to overlap also with the trading hours in the US, with different approaches. ASX makes available its own products on its own platform with long hours for trading by both domestic and global investors. KRX adopts a routing strategy to make available trading of its KOSPI 200 futures on CME Globex and established a position transfer link with Eurex for trading its KOSPI 200 options. TSE established a similar link with NYSE Liffe for trading its TOPIX Index futures. SGX has long hours of overnight trading in its foreign index futures (N225 and MSCI TW futures) to compete with or complement similar products on CME in the US 3. Conclusion Hong Kong is among the few key exchanges in the Asia-Pacific which still retain a lunch break in their normal trading session. The current trading hours for the securities and derivatives markets in Hong Kong are the shortest, after the Mainland exchanges, among major exchanges in the world. Many exchanges are offering longer trading hours for global investors. Extended hours are widely adopted for index derivatives around the world, particularly on the Asia-Pacific exchanges, to bring in customers from different time zones. Although it is less common, some exchanges also have extended hours for their equities and derivatives on individual equities. HKEx s recent decision to lengthen its trading hours will bring it more into line with international practice. Market globalisation and intensifying competition may warrant further changes in HKEx s trading hours in the future. 2 Extension is by way of routing to CME s Globex electronic trading platform for KOSPI 200 futures and the trading of futures on the options on Eurex for KOSPI 200 options. 3 See separate article in this issue of Exchange on the after-hours trading of selected products on these markets. 40 Exchange July 2011

6 Appendix Trading schedules of selected exchanges key products (in local time and Hong Kong time) HKEx Securities [ ] 09:30 12:00 09:30 12:00 Stock F&O [ ] 13:30 16:00 13:30 16:00 Index F&O [ ] 09:15 12:00 09:15 12:00 13:30 16:15 13:30 16:15 SHSE & SZSE Securities [ ] 09:30 11:30 09:30 11:30 13:00 15:00 13:00 15:00 CFFEX CSI 300 index futures 09:15 11:30 09:15 11:30 [ ] 13:00 15:15 13:00 15:15 ASX Equities [ ] 10:00 16:12 08:00 14:12 SPI 200 index F&O^ 09:50 16:30 07:50 14:30 [ ] *17:10 07:00 *15:10 05:00 Index options [ ] 06:00 17:00 04:00 15:00 *17:30 18:50 *15:30 16:50 Stock options [ ] 10:00 16:20 08:00 14:20 *16:20 17:00 *14:20 15:00 * No auto-matching for bids or offers [ ] *17:01 07:00 *15:01 05:00 KRX Securities [ ] *07:30 08:30 *06:30 07:30 09:00 15:00 08:00 14:00 *15:10 18:00 *14:10 17:00 KOSPI 200 index futures 09:00 15:15 08:00 14:15 [ ] #18:00 05:00 #17:00 04:00 # Order routing to CME KOSPI 200 index options 09:00 15:15 08:00 14:15 [ ] #16:00 04:00 #15:00 03:00 # Futures on KOSPI 200 index options on EUREX Stock options [ ] 09:00 15:15 08:00 14:15 ^ refer to those for US DST. Asia Pacific * Extra sessions separate from normal hours ASX (night trading / manual late trading / overseas trading), KRX (pre-hours / post-hours), OSE (evening session), SGX (T+1 session), TSE (evening session). Note: exclude pre-opening and cover up to closing auction. For SGX, trading hours exclude pre-opening, pre-closing and non-cancel sessions. Sources: published on respective exchange websites, viewed on 6 April OSE Equities [ ] 09:00 11:00 08:00 10:00 Nikkei 225 index (N225) 09:00 15:15 08:00 14:15 F&O [ ] *16:30 23:30 *15:30 22:30 Stock options [ ] 09:00 15:15 08:00 14:15 SGX Securities [ ] 09:00 12:30 09:00 12:30 14:00 17:00 14:00 17:00 Nikkei 225 index futures 07:45 14:25 07:45 14:25 (N225 Futures) [ ] *15:15 02:00 *15:15 02:00 MSCI Taiwan index futures 08:45 13:45 08:45 13:45 (MSCI TW Futures) [ ] *14:35 02:00 *14:35 02:00 Nikkei 225 index options 07:45 14:30 07:45 14:30 (N225 Options) [ ] *15:15 02:00 *15:15 02:00 TSE Equities [ ] 09:00 11:00 08:00 10:00 12:30 15:00 11:30 14:00 Index futures [ ] 09:00 11:00 08:00 10:00 *16:30 19:00 *15:30 18:00 # TOPIX futures on NYSE Liffe [ ] #14:00 15:00 #13:00 04:00 Index options [ ] 09:00 11:00 08:00 10:00 *16:30 19:00 *15:30 18:00 Stock options [ ] 09:00 11:00 08:00 10:00 41 Exchange July 2011

7 Appendix Trading schedules of selected exchanges key products (in local time and Hong Kong time) (cont d) BI Equities [ ] 09:00 17:30 15:00 23:30 *18:00 20:30 *00:00 02:30 Derivatives [ ] 09:00 17:40 15:00 23:40 BME Equities [ ] 09:00 17:35 15:00 23:35 Stock & index F&O [ ] 09:00 17:35 15:00 23:35 FWB Xetra Equities [ ] 09:00 17:30 15:00 23:30 FWB floor trading 09:00 20:00 15:00 02:00 Equities [ ] Eurex EURO STOXX 50 index 07:50 22:00 13:50 04:00 futures [ ] EURO STOXX 50 index 08:50 17:30 14:50 23:30 options [ ] German stock options [ ] 08:51 17:31 14:51 23:31 Euronext Equities [ ] 09:00 17:30 15:00 23:30 LSE Europe SETS electronic order book 08:00 16:35 15:00 23:35 (for liquid stocks) [ ] International Order Book 08:15 15:40 15:15 22:40 (IOB) (for depositary receipts (DRs)) [ ] Stockholm Equities [ ] 09:00 17:30 15:00 23:30 Derivatives [ ] 09:00 17:25 15:00 23:25 NYSE Liffe FTSE 100 index futures 01:00 21:00 08:00 04:00 [ ] Stock options [ ] 08:01 16:30 15:01 23:30 * Extra sessions separate from normal hours BI (after-hours for liquid stocks only), BM&FBOVESPA (after-market), CME (second session of electronic trading), NYSE (extended hours). ** The trading hours in local time of BM&FBOVESPA during Brazilian DST start and end later than the non-dst hours. The trading hours in this table are the non-dst trading hours. Note: exclude pre-opening and cover up to closing auction. Sources: published on respective exchange websites, viewed on 6 April Americas BM&FBOVESPA** Equities [ ] 10:00 17:00 21:00 04:00 *17:45 19:00 *04:45 06:00 Index futures [ ] 09:00 17:30 20:00 04:30 Stock options [ ] 10:00 17:00 21:00 04:00 *17:45 19:00 *04:45 06:00 CBOE Index options [ ] 08:30 15:15 21:30 04:15 Stock options [ ] 08:30 15:00 21:30 04:00 CME S&P 500 F&O [ ] 08:30 15:15 21:30 04:15 15:30 16:30 04:30 05:30 *17:00 08:15 *06:00 21:15 NASDAQ Equities [ ] 09:30 16:00 21:30 04:00 NASDAQ Options Market 09:30 16:00 21:30 04:00 [ ] NASDAQ OMX PHLX 09:30 16:15 21:30 04:15 (for options) [ ] NYSE Equities [ ] 09:30 16:00 21:30 04:00 #16:00 18:30 #04:00 06:30 # Basket crossing [ ] * NYSE Arca [ ] *16:00 20:00 *04:00 08:00 Index options [ ] 09:30 16:00 21:30 04:00 Stock options [ ] 09:30 16:00 21:30 04:00 TMX Equities [ ] 09:30 16:00 21:30 04:00 S&P/TSX 60 index futures 09:30 16:15 21:30 04:15 [ ] Stock options [ ] 09:35 16:00 21:35 04:00 42 Exchange July 2011