Afterparty or aftershock? How extension of F&O trading hours may impact traders
NSE) said it has sought Sebi's approval to add another evening session from 6-9 pm.
While longer trading hours mean more revenue for exchanges due to increase in volumes, derivative traders fear that their work-life balance may go for a toss.
«Prima facie an average F&O trader, is less likely to warm up to the idea of the evening session as it eats into one’s personal time and space, which is essential for research and planning or more importantly time off the market for recharge and introspection,» said Anand James, Chief Market Strategist at Geojit Financial Services.
NSE wants to extend trading hours in a gradual manner, depending on the feedback from market participants, including FIIs and brokers. As of now, there are no plans to tweak the timings of the cash segment as the second session would be meant only for index future and options.
The exchange's rationale is that the extension will give traders a chance to react to global events.
«It is important to be open when the US market opens and that is why (we want second session from) 6 pm to 9 pm. A mere extension up to 5 pm or 5:30 pm might not have solved that need,» Sriram Krishnan, Chief Business Development Officer, NSE, said.
The evening session could also attract a different breed of traders, in particular those who also have other pursuits to follow during day time.
«While large investors who need depth and tight spreads could wait for the regular session, those looking to react early to global news flow could be interested, despite the risk of potentially lower volumes.
