One Month Since Early Opening of Derivatives Market... Exchange "Considering Expansion of Night Trading"

The opening time of the derivatives market was moved 15 minutes earlier, resulting in more accurate predictions of the stock market opening price and an increase in trading demand. The Korea Exchange (KRX) announced on the 19th that it plans to consider further extensions of trading hours, including the establishment of its own night market.

In a performance analysis press release marking one month since the early opening of the derivatives market, KRX self-assessed that "highly reliable derivative prices capable of predicting the stock market opening price have been formed due to active participation by professional investors such as institutions and foreigners."

Since July 31, the opening time of the derivatives market was adjusted from 9:00 AM to 8:45 AM, 15 minutes earlier. Accordingly, index futures prices before 9:00 AM closely resembled the stock market opening price and its rate of change, serving as a leading indicator. The correlation coefficient between the stock index (opening price) and index futures (as of 8:45 AM) price change rates improved from 0.83 to 0.95 in the KOSPI market before and after the early opening implementation. This means that the stock market opening price can now be predicted faster and more accurately.

Additionally, the average daily trading volume of derivatives with the early opening applied last month was approximately 4.28 million contracts, an increase of 6.8% compared to the previous month and a 46.2% increase year-on-year. This is interpreted as an effect of new demand inflow following the early opening.

A Korea Exchange official stated, "The early opening of the derivatives market has greatly contributed to resolving information asymmetry by allowing stock investors to use index futures prices for investment decisions before the market opens," adding, "With the listing of Monday weekly options alongside the existing Thursday weekly options, a foundation has been established to efficiently manage short-term risks." The official further added, "We plan to consider additional extensions of trading hours, such as establishing our own night market, to ensure that the derivatives market can fully perform its core functions of price discovery and risk management."

This content was produced with the assistance of AI translation services.