Weekend trading of Nvidia scandal shines light on new financial products

A weekend trade linked to a Nvidia scandal has drawn attention to perpetual futures, a financial product that allows trading when traditional markets are closed. These contracts can provide a live indication of market sentiment outside normal trading hours, when investors otherwise have few ways to respond to breaking news.

Perpetual futures, or “perps”, do not expire and can offer highly leveraged exposure to a wide range of assets, trading 24 hours a day, seven days a week. They served as a proxy for sentiment on oil and the S&P 500 after Iran’s 13 April 2024 drone attack on Israel, when traditional markets were shut; market experts say demand for round-the-clock liquidity and price discovery is growing.