On the first day of the Korea Exchange (KRX) officially entering the after-hours stock trading market, known as the after-market, it was confirmed that the trading scale of NextTrade, which had previously monopolized this sector, has noticeably decreased. The KRX after-market, which operated from 4:00 PM to 8:00 PM on the 14th, recorded a trading value of over 1.8 trillion won, marking a successful first step. However, this has led to a diversion of investors who previously traded stocks during nighttime hours, resulting in a red flag on NextTrade’s scorecard. Attention is now focused on how the newly launched KRX nighttime market will shake the position of the existing alternative trading system (ATS). Today, we will take a detailed look at what ripples this shift in the market landscape will cause in individual investors’ trading strategies. We will also carefully examine the key points to watch as the two exchanges engage in a fierce competition for customers.
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KRX Enters After-Market: First-Day Results Show Decline in NXT Trading Volume and Value
1. KRX After-Market First-Day Results
The KRX’s new nighttime stock market, which opened from 4:00 PM to 8:00 PM on the 14th, made a grand entrance by recording a massive trading scale. On that day, the total trading volume on the KRX after-market reached 72.24 million shares, with a trading value of 1.8177 trillion won. This clearly indicates that there is a substantial amount of pending demand from investors who wish to trade stocks after the regular market closes. In particular, the high participation rate of individual investors allowed us to feel the market’s intense interest in this new nighttime trading channel. The market buzzed with an energy that did not fall short of the daytime regular market, leading to initial assessments of a successful launch. It is expected that office workers on their way home from work and investors busy during the day will actively utilize this nighttime trading channel. The KRX-operated nighttime market ran non-stop for four hours, from 4:00 PM to 8:00 PM, immediately following the close of the regular market. Infrastructure has been built to allow anyone to easily participate through various brokerage accounts, significantly improving investment accessibility. With over 1 trillion won in funds flowing in from the very first day, it also sent a positive signal in terms of market liquidity supply. Participants in the stock market can now check real-time quotes and place trading orders immediately after the regular market ends. Thanks to this convenience, the first-day trading performance yielded a scorecard far better than expected.
The KRX nighttime market started successfully, with first-day trading value breaking through 1.8 trillion won.
2. Sharp Drop in NextTrade’s Trading Volume and Value
On the first day of the KRX’s entry into the nighttime market, NextTrade’s related indicators, which had previously enjoyed a dominant position, all recorded a downward trend. NextTrade’s after-market trading volume on that day remained at 12.17 million shares, a figure that plummeted by more than 41% compared to the daily average trading volume over the previous nine trading days. The trading value was also recorded at 1.7896 trillion won, a sluggish performance that was about 35% lower than the daily average amount over the previous nine trading days. This is interpreted as being because investors moved en masse to the new option, given that the nighttime operating hours of the two multiple exchanges largely overlap. Although the existing ATS had touted benefits such as fee discounts, it was insufficient to withstand the disruptive power of the KRX, which possesses massive infrastructure. From NextTrade’s perspective, a significant portion of orders heading to their platform defected, resulting in a painful blow. Some market experts analyze that this decline in indicators is not solely due to the competitive structure between exchanges. Since overall domestic stock market trading volume has recently been on a general downward trend, there is a view that it is difficult to attribute this solely to NextTrade. Nevertheless, the fact that it was immediately hit as soon as a new competitor appeared is a fact that cannot be denied. The influence of investors flocking to the KRX side, half out of curiosity and half out of expectation to experience the new trading environment firsthand, cannot be ignored. The battle for dominance in the nighttime market is expected to become even fiercer depending on what differentiated strategies the two exchanges will bring forward.
Due to the KRX’s entry, NextTrade’s nighttime trading volume and value dropped by more than 30 to 40 percent compared to the previous period.
3. Best Execution Programs and Error Incidents
It is understood that the best execution programs introduced by brokerages served as the main trading route during this after-market trading process. This program automatically connects orders to venues with more favorable price or fee conditions, even if the investor does not directly select a specific exchange. However, in the complex environment where a new system was introduced and multiple exchanges are operating simultaneously, some brokerages experienced minor confusion. In fact, notices regarding order program inspections from some major brokerages, such as Mirae Asset Securities, during the pre-market hours caused tension among investors. At Samsung Securities, a program malfunction prevented cancellation orders from being processed smoothly, leading to an incident where they had to urgently take manual measures to switch exchanges. These computer-related errors or lack of guidance caused no small amount of confusion for individual investors participating in the nighttime market for the first time. This was because unexpected delays occurred or order cancellations were rejected during the process of buying or selling stocks. Brokerages moved to contain the situation by quickly guiding customers on how to respond through emergency contact networks and announcements. As the new multiple exchange system settles in, the stability of these computer systems is cited as the most important success factor. Going forward, brokerages face the task of further improving the completeness of their order execution programs so that investors can trade with peace of mind.
Computer errors and order delay confusion occurred at some brokerages during the introduction of the best execution program.
4. Strengths of Both Exchanges and Fierce Competition
The battle for dominance between the KRX and NextTrade over the nighttime stock market has only just begun and is expected to heat up further. Both institutions have distinct strengths and weapons, so marketing strategies to lure investors are expected to be strengthened. First, NextTrade holds a strong economic advantage with trading fees that are 20 to 40 percent cheaper than those of the KRX. For frugal investors looking to save even a little on costs, an exchange with lower fees can be a much more attractive option. On the other hand, the KRX holds an overwhelming advantage in terms of the number of tradable stocks, broadening investors’ choices. NextTrade offers only around 600 tradable stocks, whereas the KRX allows free trading of over 2,000 diverse stocks. There is a fatal weakness in that if a specific stock you want to buy is not included in NextTrade’s listed stocks, nighttime trading is impossible from the start. Therefore, investors who value stock diversity are structurally forced to turn their steps toward the KRX, which boasts a massive lineup. As the practicality of fee discounts and the convenience of overwhelming stock diversity clash head-on, an exciting battle is unfolding.
The showdown between NextTrade, which leads with low fees, and the KRX, which boasts an overwhelming number of stocks, has officially begun.
5. Exchange Stances and Future Market Outlook
NextTrade has taken a somewhat cautious stance regarding the decline in nighttime trading performance, stating that they will watch the overall market flow. They explained that it is premature to attribute this decline in indicators solely to the KRX’s entry, as overall domestic stock market trading volume has been on a downward trend recently. Furthermore, they emphasized that since it has been only one day since the new exchange opened, they need to observe the trends for a little longer. They plan to formulate specific response measures after carefully analyzing trading volume changes over the coming months. There is weight to the analysis that how the market landscape will change depends not on a short-term one-day scorecard, but on medium-to-long-term liquidity flows. It has become a time for general investors to carefully weigh the pros and cons of both exchanges and choose a platform that suits their investment style. If fee reduction is the top priority, it may be advantageous to continue using NextTrade, while the KRX is the answer for those who want to trade a wide variety of stocks. Brokerages will also strive to solidify the stability of their order programs and provide an optimal trading environment by reflecting these diverse customer demands. While there may be some growing pains until the new culture of nighttime stock trading takes root, it is certainly injecting vitality into the market. We should keep a close eye on what innovative services and benefits the two exchanges will unveil and formulate wise investment strategies.
NextTrade stated that they will not be fixated on short-term results but will watch medium-to-long-term trends and respond accordingly.
6. Action Guidelines Investors Must Know
With the nighttime stock market now operating through two channels, investors need to pay a bit more attention when trading. It is safer to check in advance which exchange the brokerage’s order setting program automatically connects to when buying or selling stocks. If a specific stock is not supported on NextTrade, you must ensure that the order is placed through the KRX route to avoid trouble. Additionally, since unexpected quote gaps or sharp price fluctuations can occur during nighttime hours, it is wise to actively use limit orders. Excessive market orders increase the risk of being filled at unfavorable prices, so always calmly check the quote board before pressing the button. In the early stages of a new system’s introduction, one must keep in mind that unexpected variables such as computer malfunctions or order delays can occur at any time. Frequently checking brokerage announcements and familiarizing yourself in advance with fee differences and supported stock lists for each exchange is the shortcut to successful nighttime investing. If you are taking out your smartphone on your way home from work to consider nighttime trading, please remember the market change trends we shared today. As competition between the two exchanges intensifies, the benefits and convenience returned to investors are expected to grow larger. We sincerely hope you will achieve successful investment results through flexible and wise responses in the changing stock market environment.
When investing in the nighttime market, carefully check supported stocks and order routes, and prepare for computer variables.
Frequently Asked Questions
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