Cboe's 24-Hour Equities Trading: A Game Changer for Global Investors

As the world becomes increasingly interconnected, investors worldwide are clamoring for access to global markets during their local trading hours. Cboe Global Markets (Cboe), the world's leading derivatives and securities exchange network, has heard the call and plans to extend U.S. equities trading to 24 hours a day, five days a week, subject to regulatory review and industry developments. This move is set to revolutionize the way global investors interact with the U.S. equities market, offering unparalleled access and flexibility.

Cboe's decision to expand trading hours comes on the heels of growing demand from market participants, particularly those in Asia Pacific markets like Hong Kong, Japan, Korea, Singapore, and Australia. These investors have been vocal about their desire for greater access to U.S. equities trading and need trusted venues that can offer transparency, robust liquidity, and efficient price discovery. As the world's largest global exchange operator, Cboe is uniquely positioned to meet this demand, leveraging its global infrastructure, leading-edge technology, and proven experience facilitating around-the-clock trading in global markets.

Currently, Cboe's EDGX Equities Exchange supports extended trading hours for U.S. equities, with early order acceptance beginning at 2:30 a.m. ET and trading available from 4:00 a.m. ET to 8:00 p.m. ET, Monday through Friday. During its Early Hours Trading session (4:00 a.m. - 7:00 a.m. ET), average daily volumes on EDGX increased by 135% between 2022 and 2024. This growth in early morning trading volumes indicates a strong appetite for extended trading hours, which is likely to translate into increased liquidity during the extended hours.

To complement the planned expansion, Cboe continues to significantly increase distribution of its U.S. equities market data for APAC and European customers, recognizing real-time pricing as an essential component of the investing and trading process. Its Cboe One U.S. Equities Feed, available to customers globally, offers consolidated, real-time market data from Cboe's four U.S. equities exchanges, which collectively account for 21.6% of U.S. equities on-exchange trading. Cboe expects extended trading hours will further increase the breadth of U.S. equities market data it already offers.

Cboe plans to make all listed NMS stocks available for trading on EDGX for 24 hours every business day (excluding U.S. holidays), subject to regulatory review, with all trades expected to be cleared through the Depository Trust and Clearing Corporation (DTCC). The company plans to seek approval from the Securities and Exchange Commission (SEC) and will collaborate with other industry participants to ensure operational readiness for this initiative.

The extension of trading hours for U.S. equities on Cboe's EDGX exchange could have significant implications for the competitive landscape among exchanges and prompt strategic responses from other market participants. As Cboe offers 24x5 trading, other exchanges may feel pressured to follow suit or risk losing market share. This could lead to increased competition for market share, attraction of global investors, potential for new market segments, technological advancements, and regulatory responses.

In conclusion, Cboe's plans to extend equities trading to 24 hours amid global demand is a game changer for international investors, particularly those in Asia Pacific markets. This move will offer unparalleled access and flexibility to the U.S. equities market, enabling investors to react to global macroeconomic events as they happen, manage risk more effectively, and adjust positions around the clock. As the competitive landscape among exchanges evolves, other market participants will need to adapt their strategies to remain competitive in this rapidly changing environment.