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Japan Next Securities Quarterly Report: Q1 2025 Night Market Insights

Japan Next Securities, based in Minato, Tokyo, is a pioneer in operating Japan's leading Private Trading System (PTS). In a bid to enhance awareness and utilization of the Night Market, the company has released its quarterly report analyzing trading activities from January to March 2025.

The Night Market offers a unique opportunity for investors to trade between 5 PM and 6 AM, allowing them to respond to global economic trends and significant news. This freedom has resulted in the Night Market attracting increasing attention and usage among investors, particularly individual traders. Given the positive trend, the report provides insights that can aid in taking advantage of the Night Market effectively.

Trading Volume and Trends

In the first quarter of 2025, the average daily trading value in the Night Market showed an upward trend, reaching ¥7.75 billion in March. Days where trading exceeded ¥10 billion were noted, marking a strong start to the quarter.

One notable day was January 27, when trading volumes soared to approximately ¥15 billion. This spike was influenced by an announcement from Chinese AI company Deep Seek regarding a low-cost generative AI model, which caused concern over existing AI-related businesses and led to a significant drop in global stock markets. Consequently, this prompted an uptick in leveraged ETF trading during the Night Market, reflecting cautious sentiment ahead of the following day’s market open.

Similarly, on February 28, a day when trading volume reached about ¥14.6 billion, the market reacted to rising geopolitical risks following a meeting between U.S. President Trump and Ukrainian President Zelensky, again resulting in heightened activity in leveraged ETFs.

These trends highlight a pattern: significant price movements often lead to increased trading activity in index-linked leveraged ETFs during the Night Market.

Average Transaction Volume and Security Selection

In terms of the number of trades per day, the latest quarter showed a slight increase compared to the previous quarter; however, it remained stable overall. When categorized, the numbers for the TOPIX 100 and TOPIX MID 400 segments remained relatively unchanged, while the TOPIX Small and Non-Topix segments exhibited slight gains.

Examining individual securities, the ETF representing the NEXT FUNDS Nikkei 225 leveraged index led trading volumes, while significant activity was also noted for Meta Planet (3350), which emerged as a standout performer. This can be attributed to its Bitcoin holding strategy, capturing the attention of investors as Bitcoin prices surged. However, following an adjustment phase, the stock faced volatility, reflecting speculative trading patterns that extended into the Night Market.

Trading Strategies and Patterns

The Night Market allows trading of securities that hit their daily limit up or down during standard hours immediately, utilizing altered price limits for these stocks. This characteristic enables traders to enter positions that may not have been feasible during conventional trading hours. An analysis of stocks that reached their daily limits revealed that approximately 64% of those experiencing limit ups continued to rise in the Night Market, and 58% of these stocks maintained upward momentum into the next day. Conversely, around 60% of stocks that hit limit downs saw declines in the Night Market as well.

Impacts of Earnings Announcements

Earnings announcements often occur after regular trading hours, offering opportunities for Night Market trades based on new information. During this period, about 25% of stocks experienced price movements greater than 3%, with nearly 55% demonstrating shifts between 1% to 3%. This emphasizes the potential for greater revenue opportunities due to the accessibility of trading outcomes post-announcement in the Night Market.

Conclusion

The Night Market stands out for its real-time trading capability, providing investors with immediate opportunities to respond to situations outside regular trading hours. By utilizing this service, investors can better manage risks and seize potential profits. Japan Next Securities continues to produce these quarterly analysis reports, emphasizing a commitment to enhancing the investor experience in Japan’s Night Market.

About Japan Next Securities

Founded in November 2006, Japan Next Securities has established itself as a leader in the PTS market, delivering reliable trading solutions and valuable market data. CEO Masakatsu Yamada leads the firm, emphasizing innovation and transparency in the securities industry.

For more insights and trading data, please continue to follow Japan Next Securities and the evolving opportunities within the Night Market.