Is the 30 minute extension of the transaction end time sufficient? short? Will the first change in the Tokyo Stock Exchange in 70 years lead to investor expansion

The Tokyo Stock Exchange officially announced on the 20th that it will extend in-person trading hours by 30 minutes from 2024/11/5 and change the transaction end time from the conventional 15:00 to 15:30. This is the first time in 70 years since the Tokyo Stock Exchange changed from 14:00 to 15:00 in 1954.

The Tokyo Stock Exchange explains the reason for extending transaction termination time, as “in addition to responding to environmental changes surrounding the market and diversifying needs of investors, we will further enhance the convenience, international competitiveness, and resilience (resilience, elasticity) of market users.” Ahead of the start of the new NISA from 2024, I would like to connect the extension of transaction end time to the expansion of investors themselves along with improved convenience for investors.

According to reports such as NHK, etc., the Tokyo Stock Exchange discussed extending trading hours in 2000, 10, and 14, but there is a history where this was not realized due to opposition from securities companies that conduct door-to-door sales, the investment trust industry, etc. The reason this discussion, which is the fourth time, began was a large-scale system failure that occurred in 20/10. In response to the fact that transactions were stopped all day without restoration being made in time, from the viewpoint of increasing the possibility that transactions can be resumed on the day the failure occurred, they proposed an extension of “a few hours” or “30 minutes,” and it is said that studies aimed at realizing a 30-minute extension began.

Even though the transaction time will be extended by 30 minutes, from a global perspective, the transaction time is still in the short category. The Nihon Keizai Shimbun has introduced comments such as “if time is extended, opportunities for investors to buy and sell will increase by that amount” and “there is meaning in the extension itself after 70 years,” but NHK pointed out that there are many people who look at “how transaction volume increases may be limited.” The Nikkan Kogyo Shimbun also reports that “this (30 minutes) is insufficient” and “trading time is short in competition with overseas markets,” and “in order to establish the position of an international financial center,” it is also reported that “in order to establish the position of an international financial center, we should develop a 'night trading market' that makes it possible to create investment opportunities in the connecting time from the end of the Tokyo market to the opening of the New York market.”

Furthermore, the Tokyo Stock Exchange will also introduce closing auctions in line with the extension of transaction end times. Order acceptance time (pre-closing) is set for 5 minutes from 15:25 to 15:30 after the end of the Zara Market, and order fulfillment is carried out based on the order. According to data from the Tokyo Stock Exchange, it has already been introduced in New York, London, Euronext, Singapore, Hong Kong, etc.