The new closing trade phase is flourishing, but retail investors remain on the sidelines

The stock exchange is trying to understand why retail investors are absent from the closing trade phase. An examination by the stock exchange regarding the trading volumes that characterize the new closing phase, TAL (Trading at Last), shows that retail investors account for only 5% of the total trading volume in stocks during the closing phase, with a total of 185 million shekels since the beginning of 2026. It should be noted that this is an exceptionally low participation rate for retail investors, who account for about 12% of trading volumes on the stock exchange.

In general, according to the stock exchange, the daily average of trading at the closing price in 2026 stands at 108 million shekels compared to 71 million shekels in 2025, an increase of 53%, which indicates an increase in the adoption of trading in the closing phase but also corresponds to the general increase in trading volumes on the stock exchange. Since the launch of the trading phase in August last year, about 22 billion shekels have passed through the closing phase.

"This pattern of underutilization of sophisticated trading orders is a general problem that we identify in the activity of the private investor. These orders can serve the investors, however, in the absence of familiarity and accessibility, they miss this ability," says Yaniv Pagot, Director of Trading at the stock exchange.

Retail investors — private investors who independently buy securities for their personal account — have become a significant force on the stock exchange in Israel in the last two years. According to stock exchange data, 200,000 retail accounts were opened in 2025, and estimates are that today there are close to a million retail investors — one in every ten citizens in Israel.

The stock exchange is trying to allow the investor to execute a transaction after the closing price has already been set and at a known price in advance. Already in the 2024 annual report, the stock exchange marked TAL as one of the infrastructure projects it plans to launch in the second half of 2025, alongside steps such as moving to a trading week from Monday to Friday and plans to improve liquidity.

TAL appears in addition to the auction method that was carried out at the closing stage. In the previous method, it was not possible to know at what price the auction would close and at what value you would purchase the stock. TAL adds a window of 5–6 minutes after the closing auction, in which the value of the stock or bond is already known and the investor is invited to purchase it and enters an order without a price. If there is a seller, the transaction is executed.

The low participation of retail investors in the TAL phase is attributed, according to estimates by market officials, to the fact that the mechanism provides a solution to the needs of large investors. For a private investor, there is usually no special importance in executing the transaction specifically at the closing price, and they can buy or sell during continuous trading. In contrast, for institutional investors, foreign investors, and especially passive funds, the closing price serves as a central reference point for calculating indices, asset values (NAV), and measuring performance against a benchmark.

TAL allows them to wait until the closing price is already known and then execute transactions at it, thereby reducing deviations from the index and uncertainty regarding the execution price. The adoption of TAL, which was carried out by the stock exchange management under CEO Ittai Ben-Zeev, was done in order to simulate the trading structure in Tel Aviv to trading on large stock exchanges and to facilitate institutional and foreign investors, with the latter currently responsible for 35% of the closing volume, which stands at an average of 1.1 billion shekels in 2026. According to the stock exchange, in January 2026, foreigners accounted for about 27% of the trading volume in the general stock market. The stock exchange expects that the increase in foreign participation will continue. The total activity of all channels on the stock exchange at the closing stage is 6.2 billion shekels, with 4 billion shekels of that belonging to foreigners.