NSE’s Proposed Evening Trading Session Sparks Debate Among Derivative Traders; How It May Impacts Traders

In a bid to offer extended trading hours, the National Stock Exchange (NSE) seeks approval from SEBI for an evening session from 6-9 pm, raising a pivotal question for derivative traders: Is it a welcome “Afterparty” or an unsettling “Aftershock”? While this move promises increased revenue for exchanges, traders express concerns about work-life balance.

Anand James, Chief Market Strategist at Geojit Financial Services, suggests that many F&O traders may not embrace the idea of evening sessions. They fear it may encroach on their personal time for research, planning, and much-needed breaks from the market.

NSE’s plan for extending trading hours hinges on feedback from market participants, including FIIs and brokers. The cash segment timings will remain untouched, with the extended session exclusively dedicated to index futures and options.

The NSE’s rationale behind this move is to provide traders with the ability to respond promptly to global events. Sriram Krishnan, Chief Business Development Officer at NSE, emphasizes the importance of aligning with the opening of the US market, hence the 6 pm to 9 pm session.

Additionally, the extended session could attract a different category of traders, particularly those juggling other commitments during daytime trading hours. While larger investors may stick to the regular session for depth and tight spreads, early reaction to global news may entice others.

However, it’s unlikely that Nifty or Nifty Bank derivatives will mirror the US markets completely. The impact may be limited to specific data releases like US non-farm payrolls or CPI/GDP numbers, as crucial events like FOMC rate decisions are typically announced later in the session.

Atul Parakh, CEO of Bigul, emphasizes the necessity of extending trading hours to remain competitive in the global trading arena. He sees adaptation as essential to keep traders at the forefront of opportunities.

In a rapidly evolving market landscape, the extended trading hours proposal could be a game-changer or a potential setback, depending on how traders navigate the delicate balance between work and personal life.