Published On: Tue, Nov 25th, 2014

TSE Results Of Discussion On Extension Of Trading Hours

Atsushi Saito, JPX Group CEO -

Atsushi Saito, JPX Group CEO –

Tokyo Stock Exchange, Inc. (TSE) has decided on 25 November not to extend its trading hours. The background to the decision-making process can be found below.

1.Background

– Jan. 21, 2014 Established a round table regarding the extension of trading hours
– Jul. 30, 2014 Released a report by the round table While the round table did not reach a consensus, the report suggested that the feasibility of night-time trading should continue to be considered with priority over evening trading or extension of the afternoon session.
– Aug. 2014 – Interviewed trading participants, institutional investors, and other market users

2. Night-time trading
– While many retail investors who trade through the Internet expressed their preference for night-time trading, the idea did not garner sufficient support from other retail investors who trade in-person and domestic and international institutional investors.
– In addition to the response of such investors, the majority of trading participants do not favor night-time trading at this point due to costs and profitability issues, concerns over its negative effects on fair price formation, among other reasons.
-As a market operator, while TSE would like to accommodate the demands of many online retail investors for night-time trading, we have to consider that other investors including in-person retail investors oppose the idea. As such, TSE has decided that it is not appropriate to begin night-time trading at the moment.
– This conclusion, however, does not necessarily mean that night-time trading will not be feasible in the future. TSE will continue to monitor developments and changes in the securities industry and reconsider the issue at an appropriate time.

3.Other
– Besides night-time trading, TSE also interviewed market users regarding the possibility of other plans for trading hour extension discussed in the round table, i.e., evening trading or extension of the afternoon session. Due to varied opinions from market users, consensus could not be reached on the immediate establishment of evening trading or extension of the afternoon session.

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