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The Downside of an Earlier NYSE Opening

Traders Magazine, March 2005

Gregory Bresiger

Opening the New York Stock Exchange two hours earlier - a proposal under consideration - will not help the buyside, an industry trade group wrote in a letter to the Big Board. "Buyside institutions have only a finite amount of orders in any given day. Extending trading hours will not increase the number of those orders," wrote John Giesea and James Duncan, president and chairman, respectively, of the Security Traders Association. "In fact, extending the exchange's hours could have an adverse impact on liquidity by spreading it out over a longer time span," according to the STA letter. STA complained that a 7:30 a.m. opening could wreak havoc with West Coast traders. One buyside trading executive said he understood the STA complaints. Still, he sympathized with the potential NYSE move, which would require close SEC attention "The Big Board would not do this by choice. They're afraid of competition," said the veteran trader. "Nasdaq," he added, "is extending their trading time. NYSE is looking at significant liquidity pool pre-opening demands."

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