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There is a growing push from retail traders, international investors, and a few big hedge funds to do something once unthinkable: keep stock markets open for 24 hours a day, 7 days a week. But when do traders sleep if Wall Street never shuts?

On today’s Big Take podcast, Bloomberg finance reporter Katherine Doherty joins host Sarah Holder to break down what’s behind the growing demand for after-hours trading on platforms like Robinhood, whether regulators will ever approve such a move, and what happens to the opening bell if the New York Stock Exchange never closes.

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Here is a lightly edited transcript of the conversation:

Sarah Holder: Katherine Doherty is a finance reporter here at Bloomberg with a pretty… specific… beat.

Katherine Doherty: I cover the plumbing of Wall Street.

Holder: She focuses on exchanges, like the New York Stock Exchange and Nasdaq.

Doherty: Really what I am covering and reporting on is how the whole ecosystem works.

Holder: How the whole ecosystem works might be changing dramatically. In late April, the New York Stock Exchange polled market participants on how they felt about a radical idea: keeping the exchange open for trading 24 hours a day, instead of from 9:30 a.m. until 4 p.m. Eastern.

Holder: What went through your mind when you saw the New York Stock Exchange was even thinking about setting up the infrastructure for a 24-hour trading day?

Doherty: I think the first thought in my mind personally was, Oh, does this extend into my protected weekends?

Holder: Yeah. When does a Bloomberg reporter ever sleep if the markets never close? It's a good question.

Doherty: The answer is never.

Holder: But — concerns about her sleep schedule aside — once she thought about it, Katherine had to admit: the New York Stock Exchange had to at least start asking the question. Because like it or not — trading outside of the stock exchange’s opening and closing bell has become a lot more common. For one thing, there’s the always-on crypto market.

Doherty: The crypto market and other markets trade 24/7 so it makes sense to at least ask the question of should we be doing this?

Holder: Today on the show: like it or not, 24-hour trading in US stocks is taking off. But can the market plumbing support the growing demand to trade all day and all night? I’m Sarah Holder, and this is The Big Take from Bloomberg News.

Holder: Bloomberg’s Katherine Doherty says that the current trading hours for the New York Stock Exchange date back to over a century ago.

Doherty: So it really stems back to the origination of the stock exchange when trades were placed in person. You had to actually go down to the floor and there were brokers that were running orders on physical pieces of paper to make sure that they got printed and that they would actually be executed.

Holder: Even though today most trading is done electronically, the original trading hours have remained the same.

Doherty: The hours have stayed because it gives a cleaner way for everyone to live their lives and buy and sell within parameters. It sets limits in that people like limits and they like rules and order, especially on Wall Street.

Holder: Are we really limiting hours just so people who work on the stock exchange can have saner lives?

Doherty: No. So think about if you're walking into a store, a grocery store and there and you're looking for fruit and there's hundreds of apples for you to choose from. You can be a little bit more choosy, get the best one that you think is the most appealing. But if there's only two apples left and they're both rotten, that might be your only choice. So, that's how I like to think about it. The bigger the better. And by setting these limits, you're essentially forcing everyone to come together and to transact during these specific hours. So it's very intentional. It is efficient. And it also creates better competition. So the more information, the more people that are expressing their value, that value is going to reflect the group as a whole. And the bigger that group is, the more accurate the price is going to be.

Holder: So, what about for people who want to trade but have their own day jobs? Or they wake up in the middle of the night, they're gripped by a desire to trade — can they trade?

Doherty: Now, they can, but they can't trade everything. And the way in which they trade is different than if they were trading during normal hours. So, when you are placing a trade, it isn't always going to go through immediately. Also, there are different pricing limits that are put in place. Think about when in normal trading hours, prices fluctuate in milliseconds, and that's because there's transactions happening all the time. During overnight, there's less transactions, so the prices aren't going to be — the term is as “tight.” They're going to be wider. And that just means that there's less transactions going on. And so your price and what you are trying to buy a share at like a specific point, at a specific price is going to be a different experience than if you were buying during normal trading hours.

Holder: But Katherine, I've definitely bought after hours on Robinhood. They just told me they'd execute it in the morning. We don't get that fun confetti. Is that not 24-hour trading?

Doherty: So it is. There are options. Robinhood, Interactive Broker — those are apps that if you are approved to trade after hours you very much can. And that is because Robinhood and Interactive Broker have teamed up with another venue called Blue Ocean. And Blue Ocean is essentially the grocery store that stays open later than everyone else. And so by partnering with them, they're able to give their customers the experience that you went through and that trade will be handled through Robinhood, but on Blue Ocean's venue. That's how we have evolved as a market to now offer the option to trade overnight.

Holder: Since its 2021 launch, Blue Ocean has seen the number of stock transactions taking place in the average night climb to 40 million shares. That sounds like a lot … until you compare it to the average 12 billion shares changing hands in the regular market. But that number of overnight traders could rise as more industry players try to go nocturnal. Hedge fund billionaire Steve Cohen has backed an exchange that wants to get into 24-hour equities trading, too. The firm — aptly named 24 Exchange — is just waiting for SEC approval, and is expecting an answer this fall.

Holder: So what fundamentally has to change about how the stock market operates to make 24-hour trading possible?

Doherty: So those are the questions that even the industry itself is trying to answer. The New York Stock Exchange, they conducted a survey with some of their users to ask the question: Do you even want to trade overnight? So first they wanted to identify, is there  demand? Because in anything, if there isn't demand, no firm would want to put in resources and essentially build something that people don't want and aren't going to use. So that was the first question that they asked. And then, based on responses, they're going to make the decision as a business of whether they build the infrastructure.

Holder: The infrastructure. Right now, the need for trades to be centrally cleared — settled by a third-party firm acting as an intermediary between buyer and seller — is why 24-hour trading can only run for five days a week. But even if the middleman issue were sorted out — not everyone is jumping at the prospect of 24/7 trading.

Doherty: In general, people don't really love change on Wall Street. Because change means you have to adapt how things have been, change means you might have glitches. A lot of this is really advanced technology, so if there is going to be change, it means that you have to invest in the infrastructure to adapt.

Holder: Coming up after the break: the potential — and potential peril — of 24/7 trading. And … what to do with those iconic opening and closing bells if the market never closes?

Holder: So far, no major exchange has yet opened up 24/7 trading. But Bloomberg’s Katherine Doherty says that a few changes in the past few years have made the prospect of always-on trading more appealing to some — if not all — market participants. Like for instance — retail traders.

Doherty: This change is a continuation of the momentum that we saw post-COVID and post the meme stock era. That was really when the definition of trading changed and the definition of a trader changed. You could be at home on your couch — and you still can — executing and buying shares of the biggest US firms. So the definition of how you trade, who is a trader, evolved. And it's continuing to evolve to adapt to people's lifestyle.

Holder: But it’s not just meme stock investors looking to trade on the latest post in WallStreetBets.

Doherty: The American firms that have built out overnight trading have said the most demand that they are seeing is from overseas. This is in India. It's in Japan.

Holder: That makes sense because for them it isn't overnight.

Doherty: Exactly. It's customers that want access to US stocks, but don't want to wake themselves up in the middle of the night.

Holder: So those are the kinds of people who might want 24/7 trading. But there are just as many saying — is this really a good idea?

Holder: But for Wall Street traders, for example, what are the downsides of this kind of model? When do you sleep if the markets never close?

Doherty: You know, I would say, oh, you wouldn't. But a lot of these firms, they have global reach. And so if you are working and living in the US and you need to provide a service overnight, you might be able to tap a colleague in Asia or in Europe before you have to wake up that day. That depends on resources. So for the firms that don't have that and aren't global, you might not be able to compete in the same way.

Holder: Since we usually see huge trading volumes right after the opening bell and right before the 4pm close, could overnight trading smooth the market out?

Doherty: I don't think right now the volumes that are shown overnight is enough to move the needle. It's not enough to smooth everything out. And there are still market malfunctions. There's technology that goes bad. Someone forgets to flip a switch. What's crazy is that as automated as things have become, and it's very automated, there are still times that there's manual errors. So I don't think that overnight trading is going to fix all problems and smooth everything out.

Holder: And what about regulators — how are they thinking about this? Are they freaking out?

Doherty: I wouldn't say they're freaking out. In fact, I would say they're curious. So Gary Gensler, the chair of the SEC, has talked about the fact that there's an application in front of the SEC for an exchange that wants to register and offer overnight trading. And the way that he talks about this is very diplomatic, and he just says, I am open for not only competition, but for innovation in the market. I want to support the market evolving. All that is good. But then he prefaces by saying they still need to abide by rules and regulations so that we prevent market manipulation and that we provide a – he always talks about an equal playing field and a safe environment for investors.

Holder: But the rules of the road that work for a set trading day don’t necessarily work around the clock. Just think of when companies usually report earnings — before the opening bell, or after markets close. And that’s for a reason — so as not to cause wild-swings in their share prices while the markets are open. If markets are open long past 4pm, when will companies drop bad news? It’s just one of many questions this change raises.

Holder: So, Katherine, what are the odds of this actually happening?

Doherty: It is happening. It's not a question. The question is how does it evolve? And that will be determined by the big players getting behind it in a meaningful way. If you did have the New York Stock Exchange or Nasdaq, which are the two biggest stock exchanges in the US, say that they are entering this space, that would be meaningful because it would both be a signal from traditional institutional finance firms that they believe this is where the future of finance is headed. And it would also attract a bigger pool of investors, potentially.

Holder: What are the odds of the New York Stock Exchange adopting this model?

Doherty: As of today, I would say it's unlikely, and that's just, that's my read of the situation. That is Katherine Doherty's prediction only because very recently we had Lynn Martin on TV asked about 24/7 trading.

Lisa Abramowicz: Let's head to New York, where Dani Burger is joined by the New York Stock Exchange President, Lynn Martin, to talk about why we all need 24/7 trading in our lives.

Dani Burger: Hi, Lisa. That's right. Because, you know, we want to be wrangling the kids and have the ability to trade trade while we do. Hi Lynn. Thank you so much for joining us.

Lynn Martin: Thanks for having me.

Burger: So some others might have opinions about this. But overall, the survey that you've gotten so far from what you've heard, I know you're still in the middle of it. What have you heard?

Martin: So far what we’ve heard is there are a lot of things to consider mainly on the infrastructure side, which is not really a surprise.

Doherty: And if she's saying that, it's not to say that they might not work on it, but that takes time and her initial read seemed to be skeptical. And if you are skeptical. So I don't think this is going to happen in a meaningful way that with the New York Stock Exchange anytime soon.

Holder: If it ever did happen, would they have to retire the bell?

Doherty: I don't think they're ever going to retire that bell. They love that bell because that bell is the— it's, it's a symbol. It is— it's their brand. And that brand is value. They have firms that will list on the New York Stock Exchange because they want their executive to get on the floor right as the market is opening and ring the bell.

Holder: So even if there's no closing, no opening, you think the bell will still be tolled.

Doherty: Yes, I think it's a true marker of history. And I think, again, people love consistency in finance.

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