Texas Stock Exchange launch planned as rival to New York
Texas is to get a new, liberated stock exchange. Why not Manchester or Leeds too?


It is certainly a bold move. TXSE Group announced on 5 June 2024 that it had $120m in backing from a group of giant financial institutions to launch a Texas Stock Exchange to rival New York. It will be based in Dallas, and the firm hopes to have it up and running by the end of this year, with trading open by 2026.
It plans to have lower costs, especially for exchange-traded funds (ETFs), and fewer rules on issues such as the diversity of the board. If it gets all the necessary approvals it will be the first time Wall Street has had a real rival for a couple of generations. Texas is the natural home for an alternative.
The southern state is home to the most Fortune 500 companies in the US and more than 5,000 private-equity sponsored companies. There are also more than 1,500 publicly traded companies in the region. By itself, Texas is the eighth largest economy in the world, with a GDP of $2.4trn, larger than Russia, Canada, and Italy. Even if it just carved out a niche as the place to list locally based businesses, it could still be a substantial force. If Canada can support a stock market, why not Texas too?
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
How will the Texas Stock Exchange work?
It will be interesting to see whether the new exchange can carve out a space as a lighter-touch regulator as well. Just like London, and most European exchanges, Wall Street has been requiring companies to meet an increasing number of diversity and governance targets. And just like London, the response has been for fewer and fewer companies to list.
From around 8,000 in the 1990s, only 4,000 are listed now, even though the US economy is much larger than it was 20 years ago. The Texas market may be an alternative for firms seeking freedom from all the rules that New York imposes.
The London market has even more absurd governance codes and regulations than New York does. Any company with a listing has to follow rules on who can be chairman, the composition of its board, the diversity of its directors, its climate-change policies, and a dozen other standards and targets that have been mandated over the last two decades. The result? Companies have been giving up in even larger numbers. In 1996, there were 2,700 businesses in London, but by last year that number had fallen to 1,100, a fall of 60%.
Major corporations such as CRH have shifted their listing to New York, many of the major initial public offerings, such as the chip designer ARM, are seeking to list there, and even a few of the giants such as Shell have hinted they may decide to move. As the number of firms dwindles, so does investors’ interest, with less and less money invested in the City.
A vicious cycle has started, with fewer companies, leading to less investment, and it is going to be very hard to break out of that now it has begun. It could get even harder under a Labour government that now looks certain to be elected early next month, which may well impose a range of extra regulations on everything from workers’ rights to diversity and climate.
Can the UK launch another stock exchange?
There is a simple solution. If Texas can launch its own stock exchange, then surely the UK could start one in Leeds or Manchester, or any of the other major regional cities. It would have nothing to do with the London Stock Exchange, and starting with a completely blank slate it could be built for the 21st century.
Just like Texas, it could offer significantly lower and easier trading for ETFs, a large slice of the equity market by themselves. And more significantly, it could ditch many of the environmental, social and governance rules that have built up over the last 20 years. True, there may be some legal obstacles, in that some of the rules are imposed on any “listed” equity. But it might not be too hard for clever lawyers to get around that by matching buyers and sellers electronically so that the shares were not technically “quoted”. This would not even be a very radical departure.
Manchester, Liverpool, Birmingham, and several other major cities of the industrial revolution, all used to have their own stock exchanges. Over time, trading consolidated in the City, and they were finally phased out in the 1980s. With the London exchange dwindling away, the moment has surely arrived to revive them.
This article was first published in MoneyWeek's magazine. Enjoy exclusive early access to news, opinion and analysis from our team of financial experts with a MoneyWeek subscription.
Sign up for MoneyWeek's newsletters
Get the latest financial news, insights and expert analysis from our award-winning MoneyWeek team, to help you understand what really matters when it comes to your finances.
Matthew Lynn is a columnist for Bloomberg, and writes weekly commentary syndicated in papers such as the Daily Telegraph, Die Welt, the Sydney Morning Herald, the South China Morning Post and the Miami Herald. He is also an associate editor of Spectator Business, and a regular contributor to The Spectator. Before that, he worked for the business section of the Sunday Times for ten years.
He has written books on finance and financial topics, including Bust: Greece, The Euro and The Sovereign Debt Crisis and The Long Depression: The Slump of 2008 to 2031. Matthew is also the author of the Death Force series of military thrillers and the founder of Lume Books, an independent publisher.
-
8 of the best lakeside properties for sale
The best lakeside properties – from a house on the southeastern shore of Loch Lomond, to a 15th-century hall overlooking a lake in King’s Lynn, Norfolk
-
Gold’s allure and why you should never 'pay a premium for graded coins'
It is easy to become distracted by the beauty of gold, but remember why you buy it, says Dominic Frisby
-
Investment opportunities in the world of Coca-Cola
There is far more to Coca-Cola than just one giant firm. The companies that bottle and distribute the ubiquitous soft drink are promising investments in their own right.
-
Donald Trump has one last chance to avert a recession in the US
Opinion Trump's chaotic policymaking has hurt businesses’ confidence. The US president must get his act together to avoid a full-blown recession, says Matthew Lynn
-
Streaming services are the new magic money tree for investors – but for how long?
Opinion Streaming services are in full bloom and laden with profits, but beware – winter is coming, warns Matthew Lynn
-
'Pension funds shouldn't be pushed into private equity sector'
Opinion The private-equity party is over, so don't push pension funds into the sector, says Merryn Somerset Webb.
-
Greg Abel: Warren Buffett’s heir takes the throne
Greg Abel is considered a safe pair of hands as he takes centre stage at Berkshire Hathaway. But he arrives after one of the hardest acts to follow in investment history, Warren Buffett. Can he thrive?
-
Who will be the next Warren Buffett?
Opinion There won’t be another Warren Buffett. Times have changed, and the opportunities are no longer there, says Matthew Lynn.
-
Will Comstock crash – or soar?
Opinion The upside for Comstock, a solar panel-recycling and biomass-refining group, dwarfs the downside, says Dominic Frisby.
-
'As AGMs go digital, firms must offer a new form of scrutiny for shareholders'
Opinion Technology has rendered big AGM meet-ups obsolete, but the board still needs to be held to account, says Matthew Lynn