23 Hours a Day: When the market never sleeps, your controls may need a wake-up call
Five Questions Compliance Teams Need to Answer to Prepare for Extended Trading.
For decades, 4:00 p.m. has provided compliance teams with a clear watershed. Pre-clearance approvals expire at the market close, blackout periods begin or end, restricted-list changes take effect, and employees know when an approval is no longer valid.
On December 6, 2026, that all changes. Nasdaq and NYSE plan to introduce a schedule running from Sunday at 9:00 p.m. ET through Friday at 8:00 p.m., with a planned one-hour maintenance window each evening. The market will still technically close, but it’s a power nap not a full night’s sleep. In addition, the London Stock Exchange (LSE) has announced that they plan LSE24 to begin in H1 2027. So, when equities can trade for 23 hours a day, what does “market close” mean for compliance?
More Than Longer Trading Hours
The SEC’s September 17 roundtable on preparations for 24-hour trading highlighted the broader implications of this shift, including overnight surveillance, clearing and settlement, investor protection, cybersecurity, staffing, systems resilience, and market-data continuity. Commissioner Hester Peirce also raised questions around supervision, thinner overnight order books, wider spreads and the practical challenge of responding to issues at 3:00 a.m.
For compliance teams, extended hours are not simply another trading session. They challenge assumptions embedded in policies and controls that have historically been built around a clearly defined trading day.
Overnight Trading Is Growing
Overnight activity remains a small portion of the U.S. equity market, but it is expanding quickly. According to the SEC, overnight trading accounted for just 0.9% of National Market System share volume in August 2026, yet average daily overnight volume had increased 359% year over year to approximately 144.6 million shares. More than 4,200 NMS stocks also traded overnight on an average day.
The compliance issue is not simply how much trading occurs overnight, but whether employees can trade during periods that existing policies, approvals, and surveillance processes may not be designed to accommodate.
What Does “Valid Until Market Close” Mean Now?
Nasdaq and NYSE’s planned schedule illustrates the challenge. The Night Session will run from 9:00 p.m. to 4:00 a.m. ET, followed by Pre-Market, Regular Market Hours, and Post-Market trading through 8:00 p.m. Even the definition of a trading day becomes more complicated, with trades executed between 9:00 p.m. and midnight receiving the next trading day’s trade date.
Consider an employee who receives approval at 10:00 a.m. to purchase a security, with that approval valid “until market close.” Does it expire at 4:00 p.m. or 8:00 p.m.? Could the employee trade when the Night Session begins at 9:00 p.m.? What happens if a blackout period or restricted-list change takes effect between sessions?
These questions touch policy, technology, and supervision at the same time, making it important for firms to establish clear definitions before extended trading becomes the norm.
Five Questions Compliance Teams Need to Answer
- Which policies and controls rely on “market close,” “trading day” or “business day”? Those definitions may need to be reviewed and clarified.
- How long should pre-clearance approvals remain valid and when do restrictions take effect? Firms need clear rules across Regular, Post-Market, Night and Pre-Market sessions that work in all markets.
- Can existing systems identify overnight activity correctly? Transaction feeds, surveillance, and exception processing need to account for overnight activity and its applicable trade date.
- Will your firm take advantage of the 23 hour day? The opportunity for firm and client trading may be compelling, how will your controls need to adapt?
- Who handles overnight exceptions? Firms need clear escalation processes for potential problems that occur outside normal compliance hours.
Preparing for a 23-Hour Market
Compliance teams do not necessarily need to operate 23 hours a day, but their controls need to account for a market that does. That means reviewing policy language, approval windows, restricted-list processes, surveillance, and escalation procedures to determine where assumptions tied to traditional market hours may need to change.
Firms should also think beyond December 6. As regulators and market participants consider further expansion of trading hours, this is better viewed as a broader structural shift than a one-time configuration exercise.
The closing bell is not disappearing, but its role as a clear compliance boundary is changing. As the trading day expands, firms need to make sure their controls expand with it.
How StarCompliance Can Help
As the leading intelligence and automation platform provider, StarCompliance (Star) helps firms automate and strengthen employee and firm compliance globally across all markets in personal trading, firm trading, pre-clearance, restricted lists, and surveillance. As trading moves beyond traditional market hours, connected and configurable controls can help compliance teams maintain oversight without requiring compliance to operate around the clock.
To learn more about how Star can help you prepare for the next era of employee trading, please contact your Relationship Manager.
