A novel stock market is establishing itself in Texas.
Beyond Wall Street, numerous regional stock exchanges existed in the US. However, many either shut down or were bought by larger firms. Currently, a new exchange is budding in Texas, with feisty backers.
In a piece of news, the renowned asset manager BlackRock and the prominent US hedge fund Citadel are endorsing the advent of a sizable national exchange in the Lone Star State. The coalition of Wall Street titans, including these two publicly-traded industry titans, are seeking to challenge the escalating compliance expenses of the Nasdaq and the NYSE, as well as fresh regulations such as diversity standards for Nasdaq board members, the "Wall Street Journal" stated.
The TXSE Group has secured money from over two dozen investors and "notable business leaders from across the nation," aspiring to rank among the "most well-funded new exchanges," James Lee, Chairman and CEO of the organization, shared on LinkedIn. The group is currently working on obtaining regulatory recognition. The Texas Stock Exchange (TXSE) intends to file registration documents with the SEC this year and begin trading in 2025.
The main hurdle for a new exchange is engendering trading activity. Traders frequently reroute their orders to the exchanges with the most significant trading volume - these days, the NYSE and the Nasdaq. Nevertheless, TXSE envisages support from its two significant new backers. BlackRock and Citadel Securities have previously bolstered new exchange foundings and account for trading between two and three percent of the equity market volume.
In the past, there were a slew of regional exchanges outside New York, which have ultimately ceased or were incorporated into the parent corporations of the NYSE and the Nasdaq over the last two decades. The Boston Stock Exchange, the Chicago Stock Exchange, and the Philadelphia Stock Exchange are included in this roll call.
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The TXSE Group, spearheaded by BlackRock and Citadel, sees potential in the growing financial markets of Texas. Given BlackRock and Citadel Securities' past support for new exchange foundations, their involvement could help attract trading activity to the upcoming Texas Stock Exchange (TXSE), intending to launch operations in 2025.
