This quarter, we launched our new Derivatives Management Insight Report. Produced in partnership with Avelacom, the report combines our previous quarterly derivatives-focused company-types report into one consolidated publication.
Each quarter, members of the Acuiti Derivatives Expert Network, a group of over 500 senior executives from across the global market, can submit questions and topics which are then circulated in a survey across the Expert Network to populate the report.
This quarter we received several questions around attitudes to 24/7 trading. The prospect of a move to 24/5, and ultimately continuous, trading is a key market structure question in traditional listed derivatives markets and beyond.
Crypto derivatives markets were born offering 24/7 trading (although not with a traditional clearing model). Now there are early moves towards a 24/7 trading structure in traditional derivatives markets.
However, the problem is that much of the institutional market that will have to service and trade this market does not appear to want 24/7 trading. Across the questions we received for this quarter’s report on 24/7 trading, the message was clear: institutions are not eager for continuous trading.
Sell-side execution desks were asked how much institutional client demand they saw for 24/7 trading. Not a single respondent said that a majority of clients were interested and almost half said that none of their institutional clients were interested, while 31% reported interest from only a handful.
Proprietary trading firms also reflected this view. Asked whether they supported extending trading hours in traditional contracts, with oil futures given as an example, 65% were opposed. Only 5% were definitely in favour, although another 30% saw some potential in the idea. Given that proprietary trading firms are generally early movers on initiatives like this, the findings are negative.
This supports what we see at our events. Acuiti specialises in smaller, focused and interactive events that bring together select groups of senior executives. At most of our events currently, 24/7 comes up – and there is usually a majority opposed to its introduction in traditional asset classes and instruments (once you exclude native crypto firms who are used to trading 24/7 and have functionality to support it).
But the question today is not necessarily whether 24/7 trading should happen in institutional markets, but whether it is inevitable. 24/7 oil markets already exist on platforms like Hyperliquid and came into their own during events such as the US and Israeli strikes on Iran, which began on a Saturday morning in February. And as native digital assets venues and prediction markets continue their expansion into traditional assets, more institutional products will be available to trade around-the-clock.
While early adopters of these products are predominantly retail today, and likely will remain so in the short to medium term, institutional firms will not be able to ignore weekend price formation as volumes and liquidity grow.
As the impact and significance of weekend price formation increases, many firms will need at least the functionality to reduce risk in their derivatives exposures over the weekend. It will become irresponsible not to.
For the larger banks, this is likely to pose an increasing competitive challenge. Tier 1 and 2 banks understandably tend to be later movers into new markets as they face a series of barriers from internal risk committees to reputational risk and balance sheet constraints.
While these new markets have remained outside traditional assets, this hasn’t been much of an issue. But as traditional asset classes move into “new market” territory, this challenge will grow. I have heard from traditional non-bank and crypto-native FCMs that they win business outside crypto offerings by initially offering trading in digital assets to larger hedge funds and other institutions that probably wouldn’t have onboarded with them otherwise, then growing their engagements. It is reasonable to expect that a similar pattern plays out with 24/7 trading.
A hedge fund, for example, with large oil positions that wants to offset or add risk over a weekend will need to onboard with another FCM if its main bank provider doesn’t offer access. Once onboarded, the new FCM will surely do all it can to get the firm to trade more with it. Making the weekend access conditional on more of the oil book being traded on traditional markets during standard hours is cleared through them is one scenario. Another is offering cross-margining efficiencies with other products.
The challenge is similar for exchanges. Assuming there is sufficient liquidity (before you shout “but there isn’t sufficient liquidity” – I will come onto that), firms will surely prefer to open a position on a market that they can exit over the weekend rather than one where they have to wait until Monday morning if the price is moving against them in liquid markets over the weekend.
The question therefore becomes not whether 24/7 markets will be offered, but how. This is clearly on the mind of FCMs as we received a question this quarter from our sell-side clearing segment about whether stablecoins were essential to any 24/7 clearing offering.
Automation will clearly also be key. Whenever we ask about barriers to 24/7 trading in our quarterly reports and other research, staffing issues are usually at the top of the list. Much of this challenge will have to be solved by automation (although other industries from healthcare to hospitality already manage round-the-clock staffing).
I will finish with the question of liquidity. Aside from the practical barriers such as staffing, lack of liquidity is the dominant reason we hear as to why 24/7 trading is a bad idea in institutional markets. The fear is that thin weekend liquidity will create market disruptions and open markets to manipulation.
This is a valid concern if you assume markets will remain as they are today once they trade 24/7. However, that is unlikely. As mentioned above, firms will automate liquidity provision. Hyperliquid, for example, already operates an automated market maker model, which provides 24/7 liquidity. This model might not suit institutional markets, but market makers will inevitably invest in automation to earn rebates and incentives around the clock without a linear increase in staffing costs.
Weekend trading will also open traditional financial instruments to more retail flow. This will boost liquidity. So too will greater institutional adoption over the weekend. Thin liquidity can create opportunities and there are certain to be pioneering prop firms and hedge funds that will see the opportunity there.
(I remember in the early days of market data charges from exchanges in the early 2010s, there was talk of a strike among proprietary trading firms who said they would halt trading for an hour in protest at the introduction of new fees. It quickly became clear this would be impractical, as everyone would pile back in to trade opportunities at the first sniff of market disruption. Ultimately, thin markets attract liquidity that quickly erodes the opportunity and creates more liquidity.)
I am not arguing that all institutional listed derivatives contracts should or will go 24/7. But for those – such as oil and gold futures and options – that are contracts where the price is predominantly informed by events that happen at all times of day, a price formation mechanism that responds around the clock is clearly of relevance.
To paraphrase Wayne from the eponymous Wanye’s World movie (for those under 40 – this is an old cult film whose popularity among teenagers during the 1990s would be entirely unfathomable to you if you watched it today), “if you build it, they will come”. Jim Morrison did turn up at in the end of the film, so too will institutional liquidity over the weekend.
To read more about what the Derivatives Market is thinking, download the Acuiti Derivatives Management Insight Report here: https://www.acuiti.io/derivatives-management-insight-report-q3-2026/.