You will be able to say when US markets are open in Singapore time and why the first and last minutes trade differently.
Hakim placed his first US order at eight on a Tuesday evening, right after dinner. The app accepted it, then nothing happened. He checked at ten and it was still pending. He went to bed, woke at six, and found it had filled at a price well above the one on his screen when he placed it. Nobody had told him the market he was buying in was still closed when he pressed the button.
US markets run on New York time, and New York's working day is Singapore's night. This lesson sets out when the session runs here, why it shifts twice a year, and why the first and last minutes behave differently from the rest.
The New York Stock Exchange and Nasdaq hold their regular trading session from 9.30am to 4pm New York time on trading days, as both exchanges publish on their websites. That is the session most prices, charts and fund valuations refer to.
Singapore runs on one clock all year. New York does not, which is why the session moves in Singapore time.
During US daylight saving time, roughly from March to November, New York is twelve hours behind Singapore. The regular session then runs from 9.30pm to 4am Singapore time. During the rest of the year, New York is thirteen hours behind, and the session runs from 10.30pm to 5am Singapore time. The day the US changes its clocks is set by US law and is not the same as the UK's, so check both dates each year rather than assuming.
Hakim's order at 8pm went in before either version of the open. Depending on his order type and his broker's settings, it either waited for the open or was routed to an early session he did not know about. Either way, the price he saw at 8pm was not the price on offer when trading began.
US exchanges also close for public holidays that are not Singapore holidays, and some days close early. The exchanges publish their holiday calendars, so add the year's closures to your own calendar once.
Many brokers also offer pre-market trading before the regular open and after-hours trading after the close. The exact windows depend on the broker and the venues it uses, so check your broker's help pages.
These sessions work, but the market is thinner. Fewer people are trading, so there are fewer orders on each side. That usually means wider gaps between the bid and the ask, and prices that can jump on small orders or on news released outside the session, such as company results. A price you see at 7pm Singapore time in the pre-market may not be close to where the stock opens hours later.
Some brokers place orders into extended hours only if you tick a box. Others have it switched on by default. Find out which applies to your account, because it decides whether an order you place in the evening can fill before the regular open.
Even inside the regular session, the open and the close behave differently from the hours in between.
At the open, overnight news, results and orders that built up while the market was closed all meet at once. Prices can move sharply in the first minutes, and spreads are often wider until trading settles. At the close, many funds and large investors trade to match the closing price, so volume rises. For a regular investor buying a broad fund, the middle of the session usually offers the steadiest prices and the tightest spreads.
In Singapore terms, the middle of the session falls in the early hours of the morning. That brings its own risk.
Trading in the middle of the night means trading tired. Someone awake at 3am to watch a price is more likely to chase a move, misread a number or type an extra zero. Most long-term investors have no reason to be awake for the session at all.
The answer is to decide your price before you sleep. A limit order, which lesson 6.2 covers, lets you set the worst price you accept and leave it to fill during the session. You place it at a reasonable hour with a clear head, and the market either meets your price or it doesn't. Nothing about a monthly purchase of a broad fund needs a decision at 3am.
Hakim now places his US orders as limit orders at around nine, after checking the previous close, and looks at the result over breakfast. For the activity, write down the Singapore-time open and close of the US regular session in both daylight saving periods, and set your broker app to show those hours, or a world clock with New York time, so you can see at a glance whether the market is open.
Write the Singapore-time opening and closing hours for US regular trading in both daylight saving periods and set your broker app to show them.
Junxiong-WFG Organisation is an authorised representative of AIA Financial Advisers Private Limited (Reg. No. 201715016G).