The alternative trading platform NextTrade (NXT) will launch on the 4th of next month. A multiple stock trading market will be formed alongside the Korea Exchange (KRX).
On the 12th, the Financial Supervisory Service (FSS) announced that it held the '3rd Joint Briefing Session of Related Institutions' at the Korea Exchange in Yeouido, Seoul, together with the Korea Exchange, the Korea Financial Investment Association, the Korea Securities Depository, and NextTrade. About 250 securities firms' personnel in charge of alternative trading platform operations attended the briefing.
NextTrade will operate a pre-market (8:00 AM to 8:50 AM) and an after-market (3:30 PM to 8:00 PM) before and after regular trading hours.
For securities firms, the transition to a multiple stock trading market system imposes the 'best execution obligation,' which requires executing investor orders in the most favorable manner. Consequently, securities firms must consider price, cost, and likelihood of execution when processing orders and execute them under the best trading conditions between the two markets.
With the introduction of multiple markets, it is expected that the securities firms' brokerage services, which had been mainly limited to simple order transmission, will become more sophisticated through competition.
Securities firms will prepare a best execution policy document and provide it to customers before receiving orders. Additionally, the Korea Financial Investment Association plans to produce and distribute various promotional materials such as standard guides and videos about the multiple markets.
NextTrade has been operating a mock market since November last year, involving securities firms and related institutions to establish a stable trading system. Currently, 15 securities firms have expressed their intention to participate in the entire market on the launch day of NextTrade.
Furthermore, 13 securities firms that have only participated in the pre-market and after-market plan to participate in the entire market starting September, and 4 firms have announced plans to join the entire market from September this year after additional preparations.
The FSS emphasized, "We will thoroughly prepare and supplement based on the key issues discussed during the joint briefing session in the remaining period," and added, "We will actively support the stable launch of the alternative trading platform to expand the capital market base and enhance investor benefits."
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