Surveillance without a closing bell.
A question for anyone responsible for market abuse surveillance.
If your firm extends trading hours and alert volumes do not move, what would you conclude?
In March, the FCA fined a firm whose trade volumes rose 45% after a new platform went live, while alerts fell 42%. Four months of trading reached no automated surveillance. There was no change control process to flag market abuse risk when the business changed.
Now look at where this is heading. US central clearing went 24x5 in June. Three US exchanges are approved for 23 hour trading. New rules redefine the trading day, with trades from 9pm ET rolling to the next calendar date. LSEG is launching a 24/5 venue in London. Tokenised equities are moving onto regulated exchanges alongside it.
That's an IT change, a regulatory change, a business change and a people change, all at once. Thinner books, wider spreads, volatility controls that don't apply overnight, patterns spanning two trade dates, and a closing price still doing the job of the only official reference.
None of it is unmanageable, but it needs to be in your change plan and your risk assessment now, not after go-live.
Our new white paper covers the detail: timeline by region, asset class differences, trade date risks, staffing across time zones, and what it means for risk assessment and training.
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