Global financial markets are rapidly shifting towards 24-hour trading, a key strategic focus for exchanges worldwide. This evolution is largely driven by retail traders seeking flexibility to buy and sell shares at their convenience. Blue Ocean, a significant 24-hour trading platform, reports over a third of its volumes from South Korea, a hub for active retail participation. This trend underscores the enduring resilience of the retail trading phenomenon, which has bounced back strongly after its initial surge during the 2020 pandemic lockdowns.
The widespread return of retail investors is evident globally. In Australia, Morgan Stanley research indicates retail trading numbers have reached new highs, with the nation’s largest retail broker, CommSec, experiencing a bumper year attracting younger, more diverse customers. China is also seeing a climb in retail investor trading share, while the United States market has recorded unprecedented retail activity. Citadel Securities, a major market maker executing a third of US retail trades, confirmed record-breaking volumes in recent months, signalling retail participation has transitioned from a cyclical event to a structural element of modern markets. These traders are notably “chasing leadership,” frequently investing in high-performing sectors like semiconductor stocks and exchange-traded funds.
Despite this global surge in trading activity, underlying market infrastructure challenges are emerging. South Korea, a hotbed for retail trading, continues to face hurdles in its bid for developed market status from index provider MSCI. The index giant recently cited long-held concerns, including issues with 24-hour foreign exchange trading, short-selling restrictions, and “early pre-settlement funding requirements” that burden market participants. These “market plumbing issues” are not trivial; they highlight a larger risk that the global financial system’s infrastructure may not be adequately equipped to handle the escalating $US140 trillion in annualised trading volumes. As trading activity continues to gush harder and faster, regulators worldwide are urged to address these structural vulnerabilities before a systemic breakdown occurs.
