Stock market traders and analysts are debating on the pros and cons of extending the stock market closing to 5:00 pm.
NSE has announced that it is extending the trading time on all interest derivates that are expiring after February 23.
Amid the news of this extension, traders are speculating on the consequences of extending trading hours in the equity segment as well.
Some traders in the derivative segment are optimistic about the time extension as the extended time will allow the traders to hedge their positions against uncertainties from the global markets.
“Resistance and negativity regarding this topic could inhibit the growth of our capital markets because financial markets are increasingly interconnected, and cutting off access to hedge will prevent India from becoming a global investment destination,” said Tejas Khoday, Co-Founder and CEO of FYERS as reported by Economic Times.
Khoday is optimistic about the time extension and said that it could ultimately benefit everyone.
A. Balakrishnan, Executive Director at Geojit Financial services opined about the connected nature of economies and global markets and extended trading hours allowing hedging positions based on information from foreign markets as reported by Live Mint.
While the extension of trading hours gives a longer duration to hedge positions, it also requires more from traders in terms of managing fatigue.
Zerodha Co-Founder and CEO voiced his concerns on the consequence of extended hours on retail investors who might suffer from “stress” and “overtrading”.
Harshubh Shah, a Nagpur-based trader said that an extension in trading hours will force him to end his 14-year career in trading. “Don't wish to put money over health. Peace matters, family time matters," he tweeted.
Other than the impact from sudden events, the extension of trading might not have any significant impact on global markets as 5:00 pm is 2 hours 30 mins away from the opening of the American markets.
Traders are in anticipation of the decision of the regulators and authorities in extending the trading hours to 5:00 pm.
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