Market Hours

Research question: What happens with information that becomes public during the hours after a financial asset market closes?

Keywords:

• Price Discovery
• Information Theory in Markets
• Market Efficiency
• Asymmetric Information

Financial Assets Exchanges

1. New York Stock Exchange (NYSE): The NYSE is located in New York, USA, and operates in the Eastern Time Zone. It is open from 9:30 am to 4:00 pm EST, Monday through Friday.
2. NASDAQ: NASDAQ is also located in New York, USA, and operates in the Eastern Time Zone. It is open from 9:30 am to 4:00 pm EST, Monday through Friday.
3. Tokyo Stock Exchange (TSE): The TSE is located in Tokyo, Japan, and operates in the Japan Standard Time Zone. It is open from 9:00 am to 3:00 pm JST, Monday through Friday.
4. London Stock Exchange (LSE): The LSE is located in London, UK, and operates in the Greenwich Mean Time (GMT) Zone. It is open from 8:00 am to 4:30 pm GMT, Monday through Friday.
5. Shanghai Stock Exchange (SSE): The SSE is located in Shanghai, China, and operates in the China Standard Time Zone. It is open from 9:30 am to 3:00 pm CST, Monday through Friday.
6. Hong Kong Stock Exchange (HKEX): The HKEX is located in Hong Kong, China, and operates in the Hong Kong Time Zone. It is open from 9:30 am to 4:00 pm HKT, Monday through Friday.
7. Euronext: Euronext is a pan-European stock exchange that operates in multiple countries across Europe, including Belgium, France, the Netherlands, Portugal, and the UK. Its trading hours vary depending on the country and the exchange, but generally are from 9:00 am to 5:30 pm CET, Monday through Friday.
8. MEXDER (Mexican Derivatives Exchange): MEXDER is located in Mexico City, Mexico, and operates in the Central Time Zone. It is open from 8:30 am to 3:00 pm CST, Monday through Friday.
9. BMV (Mexican Stock Exchange): BMV is also located in Mexico City, Mexico, and operates in the Central Time Zone. It is open from 8:30 am to 3:00 pm CST, Monday through Friday.

Opening and closing times are subject to change due to various factors, such as holidays, daylight savings time, and market conditions.

Additionally, some exchanges may have pre-market or after-hours trading sessions, which may occur outside of these regular trading hours.

• Post-market trading usually takes place from 4 p.m. to 8 p.m. Eastern time (ET), while the premarket trading session ends at 9:30 a.m. ET.
• Electronic communication networks (ECNs) make after-hours trading possible.
• Risks associated with after-hours trading include less liquidity, wide spreads, more competition from institutional investors, and more volatility.
• After-hours trading allows investors to react immediately to breaking news and is much more convenient.

Idea:

The Black-Scholes model assumes that the percentage change in the price of an asset can be modeled with a geometric Brownian motion, which belongs to the family of continuous stochastic processes with probability 1.

Despite the quadratic variation > 0, the jumps that occur in the time series between Friday’s close and Monday are too large for it to belong to a GBM, continuous with probability 1.

So, why does the market close? And isn’t this an inefficiency? If it is for a mechanistic reason, it can be solved by migrating the stock exchange platform to a decentralized, automatic, transparent, remotely executable one.

This idea is directly related to the main question of the Smart Financial Contracts project on the viability of migrating the BMV to a decentralized platform, and to the analysis of Automated Market Makers as a continuous trading mechanism.

References

https://www.investopedia.com/ask/answers/after-hours-trading-am-i-able-to-trade-at-this-time/