MW Overnight stock trading hit a record high on the night of the election

By Gordon Gottsegen

Trading volume was up around 100x on the Blue Ocean alternative trading system

Countless Americans were glued to their screens on Tuesday night as the results of the U.S. general election rolled in. Investors, however, were also glued to their portfolios.

Brokerages that offer overnight and 24-hour trading saw a surge in volume on the night of the election.

Online brokerage Robinhood Markets Inc. (HOOD) announced that it had its biggest overnight session since it launched its 24-hour market last year. According to Robinhood, the volume was 11 times higher than its usual overnight notional volume.

Robinhood executes its overnight trades using Blue Ocean Technologies LLC, a company that operates an alternative trading system from 8 p.m. to 4 a.m. Eastern time. According to a company spokesperson, Blue Ocean saw record notional volume of 3.27 billion shares traded on the night of the election.

According to a recent interview with MarketWatch, Blue Ocean sees roughly 30 to 40 million shares traded on its ATS on a given night. That means volume was up around 100 times more than usual on election night, a significant jump.

Although Blue Ocean partners with U.S. brokerages like Robinhood, the company sees a lot of the volume on its ATS come from investors based out of the Asia-Pacific region. It's likely that the surge in election night's volume came partly from these international investors, who were trading based on how an upcoming Trump presidency would affect certain companies and sectors.

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Interactive Brokers Group Inc. $(IBKR)$ also saw record overnight trading volumes on election night. The brokerage processed 349,910 trades that night, with 188,168 U.S. stock trades and 161,742 U.S. derivative trades.

Steve Sanders, executive vice president of marketing and product development for Interactive Brokers, previously told MarketWatch that the brokerage tends to see both trading volume and new account openings slow down in the immediate buildup to an election. But once the next president has been decided, traders flock back to the platform.

That momentum carried into the following day, too. On Wednesday, the Dow Jones Industrial Average DJIA closed 3.6% higher, its biggest postelection gain since 1896. Meanwhile, the S&P 500 SPX closed up 2.5% and Nasdaq Composite COMP finished 3% higher.

-Gordon Gottsegen

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(END) Dow Jones Newswires

November 07, 2024 17:49 ET (22:49 GMT)

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