Korea Exchange (KRX) will suspend overnight derivatives trading for one day right before the Chuseok holiday to help market participants manage risk.
Korea Exchange (KRX) said on the 9th it will close overnight derivatives trading operated from 6 p.m. on the 23rd to 6 a.m. on the 24th.
Because the overnight derivatives trading is cleared together with the immediately following regular trading, there is a high possibility that open positions will amplify market volatility after the holiday.
For example, if overnight trading on the 23rd this month, right before Chuseok, proceeds as normal, those transactions will be cleared together with the regular transactions on the 28th, after the holiday ends.
The suspension will cover equity derivatives such as KOSPI200 futures and options, mini KOSPI200 futures and options, and KOSDAQ150 futures and options, as well as FICC derivatives such as U.S. dollar futures and 3-year and 10-year Government Bonds futures.
Since introducing overnight derivatives trading in June last year, the exchange has implemented closures of overnight trading on the day before long holidays such as national holidays.