In what could be a boon to insomniacs and obsessive traders alike, the New York Stock Exchange is reportedly considering extending the hours of trading -- most likely by moving up the start of trading. Though hardly a new idea, the idea is apparently getting a fresh look, as NYSE CEO John Thain recently made mention of the idea at the World Economic Forum. If the new plan goes through, trading could begin at 7:30 a.m. Eastern time -- two hours earlier than present.
For those of us who aren't morning people, the first question might be, "Why?"
The answer? More money.
Not for you or me, but for the exchange. The NYSE is aggressively trying to find ways to make more money, and this is an obvious (if ill-chosen) target. At present, traders who want to do business before the NYSE opens have to turn to electronic markets like Archipelago
Of course, just because it might open the markets earlier, it doesn't automatically follow that the NYSE would see a big spike in exchange fees related to trading. Pre-market (and after-market) trading is often very thin; market commentator James Cramer has referred to it as the "badlands" and a "Wild West atmosphere." What's more, with countless studies having shown that the more investors trade, the more they lose, longer trading hours are hardly a boon to the buy-and-hold investor.
Given that a 7:30 a.m. opening would mean that East Coast traders would have to stumble in at around 6:30 or 7:00 a.m. and West Coast traders would have to be on the job at 3:30 a.m., this just might prove to be the answer to a question that nobody (save the NYSE) asked.
Maybe this is just another step on the seemingly inevitable road to 24-hour trading for all investment options. After all, you can already stay up all night trading currencies, bonds, futures, and local stocks. For me, I'd rather sleep for two more hours than spend that time watching the waggles and wiggles of the market.
For a look at a truly beautiful fantasy, read Bill Mann's Take on a day of no volume.
Fool contributor Stephen Simpson, CFA, has no ownership interest in any stocks mentioned and greets each sunrise with about as much enthusiasm as Dracula.