Why the LSE Is Considering 24-Hour Trading
The London Stock Exchange Group (LSEG) is actively exploring the introduction of 24-hour trading for UK-listed shares. This move is driven by rising demand from retail investors, increasing global competition, and a broader shift in trading patterns due to technological advancements and the growing popularity of mobile trading platforms.
Current Trading Hours vs. Proposed Changes
Current Trading Hours: 8:00 AM – 4:30 PM (London Time)
Proposed Trading Hours: 24 hours a day, 7 days a week
This change would bring the LSE in line with the round-the-clock trading models already seen in cryptocurrency markets and the expanding after-hours sessions being introduced by other major global exchanges.
What Is Driving the Change?
- Retail Investor Demand: More small investors are trading outside regular hours, especially on smartphone apps, and expect on-demand market access.
- Global Competition: The LSE aims to match markets like the US, where younger, technologically savvy investors actively trade outside traditional hours.
- Market Rejuvenation: With fewer IPOs and declining activity in recent years, the exchange sees 24-hour trading as a way to attract global and next-generation investors.
- Technological Readiness: Advances in trading infrastructure now make a continuous-trading model more viable than ever before.
Key Challenges and Considerations
- Operational Complexity: Continuous trading would require robust real-time systems, cybersecurity measures, and liquidity management protocols.
- Regulatory Requirements: Changes would need approval from UK regulatory bodies and coordination with international markets.
- Market Liquidity: There are concerns around thin liquidity and volatility during off-peak hours, which could affect pricing accuracy.
- Valuation Practices: Many institutional investors rely on end-of-day values for portfolio calculation, and 24/7 data could complicate performance measurement.
Industry and Global Context
Global stock exchanges are reevaluating their trading hours as technology and investor habits evolve. Exchanges in the U.S. have already begun steps toward longer and even round-the-clock trading. The potential shift in London is part of this broader transformation toward more inclusive, technology-driven capital markets.
What Happens Next?
The London Stock Exchange has not confirmed a timeline for 24-hour trading, and discussions are still ongoing. The initiative is expected to involve multiple stakeholders, including regulators, institutional platforms, and fintech providers. If adopted, it would represent one of the most significant changes to UK market operations in decades.
While many welcome the innovation, some industry voices are calling for a cautious approach, ensuring that broader participation and transparency are safeguarded as the market evolves.
