So, when are markets open?
While the answer to this question may seem simple, leading many people to answer: “10:00 am to 4:00 pm”, the answer is a little more complicated than that. The Australian Securities Exchange (ASX) opens at different times for groups of companies. Additionally, there is a randomisation factor added to these opening times, so there is no set time, even for the groups. Let me explain.
The market goes through different phases on any trading day, which is from Monday to Friday. From 7:00 am to 10:00 am (all times are stated in Sydney time), the market is in its pre-open phase where brokers enter orders into ASX Trade and investors enter orders online. Orders are then queued chronologically in preparation for when the market opens at 10:00 am, roughly.
The opening phase starts at 10:00 am, +/- 15 seconds, and lasts for about 10 minutes. During this time, security trading gradually opens in five, approximately 2-minute groups based on their ASX ticker codes, each with a randomly generated +/- 15 seconds added to the opening times. This means that the opening phase could potentially start from 09:59:45 am and end at 10:11:15 am. The full list of ASX group numbers, ASX ticker codes, and opening times can be found below.
After this, normal trading occurs from the end of the opening phase to 4:00 pm.
Between 4:00 pm and 4:10 pm, the market goes to the pre-CSPA phase where trading stops and brokers enter, change, or cancel orders in preparation for the market closing. Lastly, between 4:10 pm and 4:12 pm (randomised +60 seconds from 4:11 pm), Closing Single Price Auction (CPSA) commences.
The CSPA phase sees a matching off of all orders, with only overlapping buy and sell orders executed during the CSPA. The trades are executed at the VWAP (volume-weighted average price), which becomes the final closing price for the day.
While crudely speaking, the ASX is open from 10:00 am to 4:00 pm, the randomised and staggered nature of the opening times make it so there are no definitive open times for securities. Moreover, this example only illustrates the opening times of the ASX, one of two major exchanges in Australia, and one of many in the world of financial bourses.