Korea Change headquarters in Seoul / Korea Instances file
The Korea Change (KRX) is searching for to introduce a 24-hour buying and selling regime by December subsequent yr to boost the competitiveness of Korea’s capital market, in keeping with international bourses more and more transferring towards round the clock buying and selling, in accordance with firm officers Friday.
As a transitional measure, KRX plans to roll out pre-market and after-hours periods beginning in June, successfully extending every day inventory buying and selling hours to 12 hours from the present six hours and half-hour.
Below the proposed framework, KRX is contemplating opening a pre-market session from 7 a.m. to eight a.m. and an after-hours session from 4 p.m. to eight p.m. If applied, buying and selling would start an hour sooner than at different buying and selling system Nextrade, which opens its pre-market session at 8 a.m.
“The transfer is meant to shortly accommodate rising demand from home and abroad buyers to replicate market developments within the U.S. and Europe of their portfolios at an earlier stage, whereas additionally broadening participation within the Korean fairness market,” a KRX official stated.
At the moment, NYSE Arca, a part of the New York Inventory Change, operates buying and selling periods of as much as 16 hours a day and plans to introduce 24-hour buying and selling alongside Nasdaq within the second half of this yr. Inventory exchanges in London and Hong Kong are additionally reviewing comparable initiatives.
In keeping with KRX, these developments underscore intensifying competitors amongst international exchanges to draw liquidity from retail buyers, significantly throughout Asia.
Nonetheless, issues are mounting over heavier workloads for workers and rising working prices for brokerage companies that may accompany longer buying and selling hours.
Business officers pressured that extending buying and selling hours goes far past merely increasing IT staffing. An extended buying and selling schedule would require further personnel throughout back-office features comparable to settlement, fund administration and withdrawals.
This could inevitably result in longer working hours and elevated extra time, making the initiative troublesome to advance with out the consent of labor unions. However, they stated, the plan is being pushed forward unilaterally, with out adequate session with business stakeholders.
The Korean Finance & Service Employees’ Union has formally voiced its opposition to extending buying and selling hours and plans to carry a press convention subsequent week to protest a 7 a.m. market opening.
The KRX’s labor union can be reportedly making ready to carry a public listening to later this month, whereas labor unions at brokerage companies have already begun expressing opposition.
“The Korea Change ought to cease pursuing profit-driven operations,” the Daishin Securities labor union stated in an announcement. “The every day routines of tens of hundreds of thousands of buyers could be disrupted, whereas market monitoring and response efforts would demand much more time. Securities business staff could be burdened with extreme workloads.”
A securities business official stated, “With Nextrade already in operation, it’s obscure what further advantages would come from KRX additionally extending buying and selling hours. If the purpose is to compete with Nextrade, KRX ought to pursue sensible measures comparable to payment reductions, moderately than merely lengthening buying and selling hours.”
