Tokyo Commodity Exchange, Inc. announced today that the Exchange has decided to aim for an extension of trading hours for the night session until 4:30 (JST) from September 21, 2010. Currently, TOCOM’s trading hours are from 17:00 to 23:00 for the night session and from 9:00 to 15:30 for the day session. As for the rubber futures contract, trading hours will not be changed from 9:00-15:30 and 17:00-19:00.
TOCOM’s listed products are internationally traded commodities and their prices fluctuate while TOCOM’s market is closed. Therefore, by keeping its market open longer, the Exchange aims to offer more trading opportunities to market participants, which will improve the overall convenience of the market.
TOCOM decided to extend the trading session beyond 23:00 because the overlap in trading hours with the New York market could greatly benefit arbitrage traders and the dollar-yen exchange rate, which is thought to be one of the factors that contributes to increasing gold trading volumes, tends to fluctuate more around that time. During these hours, individual investors are also relatively active in trading FX and CFDs over the internet. TOCOM set the closing time of the night session at 4:30 to coincide with the closing of New York crude oil floor trading.
In the months ahead, TOCOM will take all necessary measures for the extension to ensure a smooth transition, including verifying the stability and assessing the performance of the trading system, as well as reviewing procedures in case of system failure.
The Exchange has also examined the possibility of extending the trading session into the break time (i.e: from 15:30 until 17:00), as it overlaps with the Singapore and London markets, but decided to maintain the current break. TOCOM determined that it would be difficult to change this break time because of certain constraints, including the fact that the day session cannot close later than 15:30 in relation to publishing the reference prices of ETFs and investment funds linked to TOCOM markets, and the fact that TOCOM shares with the other three commodity exchanges in Japan a common pool calculation system for customer margins.