SEC Trading and Markets Director Outlines Readiness Path for 23-by-5 Trading and Possible 24-by-7 Ma

Key Takeaways

• SEC Division of Trading and Markets Director Jamie Selway used a roundtable to signal strong staff support for extended-hours equity trading, noting that market data infrastructure is scheduled to expand to 23 hours a day, five days a week on December 6, 2026.
• The remarks are not a rule or formal guidance, but they show where the Division's priorities lie and what it expects of the industry.
• Compliance teams should treat them as a prompt to confirm operational, surveillance, and investor-disclosure readiness for overnight trading.

Deep Dive

SEC Division of Trading and Markets Director Jamie Selway used a roundtable to signal strong staff support for extended-hours equity trading, noting that market data infrastructure is scheduled to expand to 23 hours a day, five days a week on December 6, 2026. The remarks are not a rule or formal guidance, but they show where the Division's priorities lie and what it expects of the industry. Compliance teams should treat them as a prompt to confirm operational, surveillance, and investor-disclosure readiness for overnight trading.

The key date is December 6, 2026. Broker-dealers, exchanges, ATSs, market data users, and clearing participants should assume that trading, data, and post-trade processes will operate across much longer windows. The roundtable had three panels covering preparedness, resiliency, and expected impacts and next steps. Those themes indicate likely supervisory focus: operational readiness, business continuity, and the effect on investors and issuers. The Division also published a staff paper analyzing overnight and cross-session volume, the characteristics of stocks traded overnight, and participant activity across sessions. Firms should read it for insight into how staff views liquidity and investor behavior in extended sessions.

Compliance teams should take several actions now. First, map current policies and procedures to a near-continuous trading environment. This includes best execution, order handling and routing, market access controls, and Regulation NMS and Regulation SCI considerations where applicable. Second, confirm that surveillance and trade reporting (including FINRA TRF reporting) can handle overnight activity, and that staffing and escalation coverage are adequate. Third, review customer disclosures, account agreements, and marketing materials. Retail investors need clear explanations of the risks of overnight trading, including thinner liquidity, wider spreads, and higher volatility. Fourth, test resiliency, including vendor and third-party dependencies, cybersecurity, maintenance windows, and incident response across clearing, settlement, and data feeds.

The main risks are operational, conduct-related, and investor-protection risks. Longer operating hours compress maintenance and recovery windows, increase technology and third-party exposure, and strain staffing and monitoring. Thin overnight liquidity may raise concerns about execution quality, price dislocations, and suitability or disclosure for retail customers. Firms also face competitive pressure to offer extended hours, which should not outpace control readiness. Issuers should prepare for how overnight trading may affect price discovery around disclosures and earnings events, and should coordinate with their investor relations and disclosure functions. Firms should watch for any follow-on Commission statements, rule changes, or SRO guidance after the roundtable.

Source: Securities and Exchange Commission