TAIEX Futures Night Session Guide

The background and purpose of the establishment of the Taiwan Futures Exchange night trading session.

The Taiwan Index Night Market was launched by the Taiwan Futures Exchange (TAIFEX) in 2014 to address the time zone differences between the Asian and Western markets, extending trading hours. This allows Taiwanese investors to react in real-time to international market trends and significant economic events during the opening hours of the Western stock markets, avoiding missed trading opportunities due to information lag.

Trading Time and Product Introduction

The night trading session starts daily at 3:00 PM and continues until 5:00 AM the following day, covering the main trading hours of the US stock market (Eastern Time 9:30 AM to 4:00 PM), with the market closed on weekends and public holidays. Tradable items are not limited to Taiwan index futures (TX), but also include electronic futures, financial futures, and mini Taiwan index futures, providing investors with diverse options.

Margin and Cost Difference

The night market follows the same margin standards as the day market, but due to lower liquidity and reduced trading volume in the night market, this may lead to wider spreads and relatively increased trading costs. Investors should pay attention to the associated risks.

The main advantages of night trading

The night market allows investors to respond instantly to fluctuations in the international stock market, reducing overnight risk; at the same time, it enables the use of futures tools for quick hedging or implementing cross-market arbitrage strategies; it provides convenience for investors who find it difficult to trade during the day, increasing market participation.

Risks and Challenges

The trading volume during the night session is relatively low, which may lead to an increase in spread and slippage risks; unexpected international news may exacerbate volatility; nighttime trading can easily create psychological pressure, affecting judgment; technical analysis signals during the night session may become distorted, so caution is required.

Trading strategy recommendations

It is recommended that investors establish fixed trading and resting times to prevent chaotic living habits; strictly manage leverage to reduce the risk of liquidation; analyze both daytime and nighttime trends to enhance judgment accuracy; and set stop-loss and take-profit points in advance to effectively control emotional trading.

Summary

The Taiwan Futures Night Market is an important mechanism connecting global markets, suitable for investors who grasp international market changes. Although there are challenges, with good risk management, one can fully utilize the hedging and arbitrage opportunities brought by the night market to expand trading horizons.