Investors feel that the extended market hours will result in a loss of social life and will bring about excessive stress.
Despite permission from the Securities and Exchange Board of India (SEBI) to increase market trading hours in 2009, the National Stock Exchange (NSE) is waiting for members’ feedback to extend the equity market trading hours, soon. It says it will soon increase the market trading hours, but has not confirmed the date yet.
A Business Standard report quoted the MD of NSE, Ashishkumar Chauhan saying, “SEBI has already allowed equity market timing to be extended to 9 a.m. to 5 p.m., maximum. In derivatives, they have allowed from 9 a.m. to 11:55 p.m. We have not moved forward. Now, we are working with our members and taking their feedback on what all needs to be done.”
The paper says, “It is important to align Indian markets, as far as possible, with those of the international markets to facilitate the assimilation of any economic information that may flow in from other global markets. One such alignment could be in the area of market timing.”
Taariq, a retail investor and intra-day trader said, “It’s better to trade within a specific time so that you can move on to other things. Trading requires a lot of research, which can stop after trading hours, but if there are extended hours, it’s difficult to take a break from research and move on to the next activity in life.”
He further said that extended trading hours may be good or bad, depending on the investor, but will definitely take a toll on your social life and mental well-being.
Nithin Kamath, the founder of Zerodha on a Twitter thread said that he’s in a conflict about the extended trading hours as ‘Tracking P&L’ for longer hours is stressful and can affect life outside trading.
The SEBI report says that the reason for increasing market trading hours is to bring in more global financial flow. The quick flow of information can reduce the volatility of the market and impact costs.
Kamath’s Twitter thread also said, “Active traders don’t make money, primarily due to overtrading. Longer hours can accentuate this.”
Currently, the New York Stock Exchange (Wall Street) and the NASDAQ are the two major stock exchanges in America. They have 5 and a half and 4 hours of after-market hours trading.
Savitha R, former investment advisor at Santander Bank, New Jersey said, “If the hours are extended, it can bring in a lot more youth to start trading and investing in the stock market.”
She further said, “For bigger firms with an extensive portfolio, the extended hours will help accommodate international markets like that of the United States and the United Kingdom. The big firms will hire more people to monitor the market, which will in turn create more employment opportunities.”
Savitha added, “But for day traders, it will affect family time, and personal time and even add to stress and result in factors like stress-eating and they won’t be able to stop working after regular working hours; they have to monitor the market till it ends.”
Ramanathan S, a day trader from Chennai says, “It is already tiring to monitor the markets from 9:15 A.M to 3:30 P.M, if it gets extended till night, it becomes almost impossible to monitor.”
He also said, “Stock broking firms will have to increase the number of staff so that they can work in two shifts and monitor the markets, which will increase the brokerage fee, and trading and investing will become more expensive.”
Sreenivasan K, a stockbroker from Chennai said, “Currently after the trading hours in India, a volume of futures investors goes into the Singapore Stock Exchange, hence NSE wants to extend the timing for the volume of exchange to take place in the Indian Stock Exchange itself.”
He said that with the extension of market trading hours, intra-day traders might not be able to achieve profitability, because it becomes difficult to analyze the trend of the market when it is dragged and prolonged.
For a stockbroker, if the timing is extended, they need to hire more employees to track the markets in the extended market, without an assurance that they will be able to recover the same cost, in the market.
Sreenivasan also said stock brokers work for hours before the market starts and hours after the market ends for the day and this might make their work timings, erratic. He further said, “Despite being completely digitalized, people are always needed to permanently monitor the market.”
Sreenivasan says that an advantage of the potential increase in market timings is that more people will enter the market. Since they might not be free during working hours, they can trade after work, with the market still open.
Haran RP, counselling psychologist and business researcher said, “Today apps make the stock market very accessible and even people with a full-time job can keep checking their phone for updates. Even with working from home, boundaries are blurred because, in the best sense, you should keep your work talk outside your house, which is now impossible. With the extended market trading hours, investors will lose out on family time, and social life and professional and personal boundaries will be blurred.”
