[DigitalToday Oh Sang-yeop] As the U.S. Nasdaq market shifts to a 23-hour trading system from next month, South Korean brokerages plan to support U.S. stock trading through alternative trading venues even when Nasdaq is not open.

According to the financial investment industry on Tuesday, Nasdaq will implement a 23-hour trading schedule starting on Dec. 6 local time. In Korea time, it will run from 11 a.m. to 10 a.m. the next day.

Nasdaq currently operates on Korea time with a premarket session from 6 p.m. to 11:30 p.m., regular trading from 11:30 p.m. to 6 a.m. the next day, and an after-hours session from 6 a.m. to 10 a.m.

From next month, a night session from 11 a.m. to 6 p.m. will be added. Trading will be halted from 10 a.m. to 11 a.m. for system maintenance and other work.

South Korean brokerages are also preparing to revamp their U.S. stock trading systems accordingly.

Brokerages are pushing plans to provide U.S. stock trading services using local alternative trading systems even from 10 a.m. to 11 a.m., when Nasdaq is closed.

Many South Korean brokerages already offer daytime trading services from 10 a.m. to 6 p.m., so there is expected to be little change in the trading hours investors can use.

Still, changes are expected in order processing.

Some brokerages are reviewing a function that automatically transfers orders between trading venues. Currently, orders placed during daytime trading are valid only during that session, and any unfilled orders disappear once Nasdaq opens.

Going forward, brokerages are considering a system in which orders submitted to alternative trading systems from 10 a.m. to 11 a.m. would be automatically carried over to Nasdaq through local intermediaries even if they are not filled.

This could make it possible for investors to keep existing orders after the trading venue changes without re-entering them.

The expansion of Nasdaq trading hours may also lead to an increase in U.S. stock investment by South Korean investors.

Daytime trading used by South Korean investors is conducted through local alternative trading systems, and it has been assessed as having fewer participants and lower trading volume than the regular Nasdaq market, with relatively weaker liquidity and price discovery.

If Nasdaq adds the night session, South Korean investors will also be able to trade directly on Nasdaq during daytime hours. With more U.S. market participants active during those hours, liquidity and trading convenience are expected to improve compared with existing daytime trading.