The 24-Hour Market: How Extended Trading Hours Are Reshaping Global Finance and Investor Strategy

The financial world is waking up—and staying awake. By 2025, the once-rigid boundaries of trading hours are dissolving, replaced by a global market that never sleeps. From London to New York to Tokyo, exchanges are racing to adopt 24-hour trading, driven by a seismic shift in investor behavior, technological innovation, and the relentless pursuit of liquidity. The London Stock Exchange Group (LSEG), long a pillar of traditional European finance, now finds itself at a crossroads. As it weighs a move to 24-hour trading, the stakes are clear: adapt to a new era of perpetual market access, or risk being overtaken by U.S. rivals and tech-savvy disruptors.

The Liquidity Paradox: More Time, Less Depth?

The allure of 24-hour trading lies in its promise of democratized access and global participation. Retail investors, armed with zero-commission platforms and algorithmic tools, no longer need to wait for the 9:30 a.m. open to trade. This shift has been amplified by the rise of Gen Z traders, who treat markets as a 24/7 playground. For exchanges, the challenge is twofold: How to maintain liquidity during off-peak hours and how to avoid fragmenting markets into a patchwork of time zones and platforms.

Consider the U.S. markets, where overnight trading currently accounts for less than 0.11% of total equity volume. Extending trading hours to 24/7 risks exacerbating this liquidity imbalance. While peak hours will likely remain robust, off-peak periods could see order books thinning, leading to volatility and execution risks. For example, a stock trading at $100 during the day might see its bid-ask spread widen to $105-$110 at 2 a.m., deterring even the most eager algorithmic traders. The London Stock Exchange, which currently sees liquidity concentrated in open and closing auctions, faces a similar dilemma. If it adopts 24-hour trading without addressing these gaps, it could become a haven for speculative noise rather than a hub for meaningful price discovery.

The Investor Behavior Revolution

The rise of 24-hour trading is not just structural—it's behavioral. Retail investors are now perpetual traders, reacting to news in real time. The 24X National Exchange's September 2025 launch of a 23-hour trading window, for instance, is explicitly designed to capture Asian investors trading during their local daytime hours. Similarly, the NYSE Arca's proposed 22-hour window and Nasdaq's 2026 goal of full 24-hour trading reflect a strategic pivot to global demand.

For institutional investors, the implications are equally profound. Asset managers must now factor in 24-hour liquidity when constructing portfolios, while hedge funds are developing strategies tailored to extended hours. Yet, this flexibility comes with risks. Flash crashes—sudden, unexplained price drops—have already tested markets during low-liquidity periods. The 2024 “Flash Crash 2.0” in cryptocurrency markets, triggered by a single erroneous trade during the Asian session, serves as a cautionary tale.

LSEG's advantage lies in its infrastructure. As a global leader in data, clearing, and index services, it is uniquely positioned to support the logistical demands of 24-hour trading. Its National Securities Clearing Corporation (NSCC) is already adapting to the U.S.'s T+1 settlement cycle, a critical enabler for extended trading. However, LSEG must also address regulatory hurdles in the UK, where the Financial Conduct Authority (FCA) remains cautious about the stability risks of 24-hour markets.

The Competitive Race: LSEG vs. U.S. Exchanges

The battle for 24-hour dominance is not just about liquidity—it's about infrastructure and innovation. U.S. exchanges like Nasdaq and the NYSE are leveraging their technological prowess and regulatory flexibility to pioneer extended trading. Nasdaq's 2026 plan to launch 24-hour trading on its flagship exchange is a direct response to the rise of platforms like 24X, which offer faster, cheaper, and more flexible trading solutions.

LSEG, meanwhile, is adopting a more measured approach. Its recent $27 billion acquisition of Refinitiv has shifted its focus toward becoming a data and technology powerhouse. This positions LSEG to act as a critical enabler for 24-hour trading, particularly for exchanges that lack the infrastructure to support continuous trading. However, its reliance on institutional liquidity—a hallmark of the UK market—could hinder its ability to match the retail-driven momentum of U.S. exchanges.

Investment Advice for the 24-Hour Era

For investors, the 24-hour market presents both opportunities and risks. On the upside, it opens access to new strategies, particularly for those who can leverage extended hours to arbitrage time-zone price discrepancies. For example, a trader in Singapore could buy a U.S. stock during their local daytime hours and sell it in London as it opens, capitalizing on cross-market inefficiencies.

However, the risks are equally significant. Investors must be vigilant about liquidity during off-peak hours and avoid overexposure to thinly traded assets. Diversification across time zones and asset classes will be key. Additionally, the rise of AI-driven risk management tools—already a focus for LSEG—will become essential for navigating the volatility of a 24-hour market.

For institutional investors, the shift also means rethinking portfolio construction. Traditional benchmarks, which assume liquidity during standard hours, may no longer be sufficient. Actively managed strategies that incorporate real-time analytics and dynamic hedging will gain an edge.

Conclusion: The Market Never Sleeps, but Can It Sustain Itself?

The transition to 24-hour trading is not merely a technical upgrade—it's a fundamental redefinition of how markets function. For LSEG, the challenge is to balance innovation with stability, ensuring that its data and clearing services remain the backbone of global markets while avoiding obsolescence from tech-driven alternatives. The U.S. exchanges, for their part, must prove that their extended hours can sustain liquidity without fragmenting markets into a chaotic patchwork.

As the financial world moves toward a 24/7 model, the winners will be those who can adapt their infrastructure, strategies, and regulatory frameworks to support a world where markets never sleep. For investors, the message is clear: the future is perpetual, but only those who understand the risks will thrive.