Regional and specialty trade shows return as demand for new products and market locations increases. The theory that regional or specialized exchanges can bring unique knowledge to specific sectors or regions is the driving force behind this build-up.
The list of such exchanges is growing and the trend is global. For example, the Eastern Caribbean Securities Exchange (ECSE) is the Caribbean’s premier regional securities exchange, designed to attract companies with regional interconnectivity and regional investors. Companies such as Grenada Electricity Services from Grenada and the Bank of Nevis from St. Kitts and Nevis found their stock exchange listing there.
Recent discussions about a new stock exchange in the US state of Texas that would compete with the triumvirate of US stock exchange operators – the New York Stock Exchange, Nasdaq and CBOE – have reinforced this trend.
The Texas Stock Exchange (TXSE), which will be based in Dallas, will be initially funded with an investment of $120 million. In recent years, anti-New York sentiment surrounding issues such as compliance requirements and environmental, social and governance rules has led to a backlash at many companies. This has led, among other things, to the current Texan proposal.
Major liquidity providers, such as BlackRock and Citadel Securities and many Texas-based Fortune 500 companies, support the proposed all-electronic exchange.
The founders of TXSE have applied for approval from US Securities and Exchange, which is currently pending. The new exchange would offer companies a reduction in the high listing requirements often associated with established exchange operators. Texas is considered a business-friendly state with low taxes and limited legal requirements, and the entrepreneurs behind this venture hope to bring this kind of thinking to the stock market world while reducing red tape. Texas’ specialization in the energy sector, meanwhile, would provide energy companies with a new avenue for corporate financing solutions.
