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How the Texas Stock Exchange Could Reshape Dallas and the National Stock Market
Financial titans Blackrock and Citadel Securities invested $120 million in creating a national stock exchange headquartered in downtown Dallas. There are still a few steps to go before it’s official, but with the Texas Stock Exchange looming in Dallas’ future, experts believe it could change the city for years.
On top of cementing Dallas’ reputation as the financial capital of the Southsome believe it could drive longer company changes and jobs for the city and state. But questions remain about whether it can be an effective competitor to institutional powers like the New York Stock Exchange and NASDAQ.
The Texas Stock Exchange could change Dallas in several ways. From a cultural perspective to attracting corporate relocations, it could drastically change the look and feel of the city in the coming decades. It could also serve as a competitor to the New York Stock Exchange and NASDAQ, moving financial traffic away from New York and altering the flow of money in the US.
Related:Financial Giants Plan New Dallas-Based National Stock Exchange
Still, it’s a moment that most experts believe will have a positive impact on Dallas if Texas Stock Exchange CEO James Lee can get its listing approved by the US Securities and Exchange Commission. He expects the exchange to make its first listings in early 2026.
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Although he has said he will not list any of his companies on the stock market, the Dallas billionaire and Dallas Mavericks minority owner Marcos Cubano is one of many who are in favor of this.
“I think it’s an amazing and smart idea. It would be great for Dallas,” Cuban said in an email to Dallas Morning News. “Not just the jobs, but the needed improvement in digital infrastructure, the focus on Dallas-based companies this would bring, and perhaps most importantly, it would be a foundation for people to get better financial education. It would certainly be a place for schools to welcome children, even if they are just employees. I’m a big fan of the concept.”
Lee wants to see the Texas Stock Exchange become the third largest listing venue in the US, a mammoth task as he will be competing with institutional giants like the NYSE and NASDAQ.
While many local stock exchanges have come and gone over the years, Lee thinks Texas will energize him and the Texas Stock Exchange with its diverse industries and the state growing workforce.
“I’m a proud Texan and I’ve been focused on this for decades. It was really Governor Abbott’s leadership that sparked the idea that got us to where we are today,” said Lee. “We have the market structure, expertise and professionals brought together on this project. It’s exciting and will be felt for decades.”
The city skyline lights up as if it were night, a totality occurs during the total solar eclipse seen from the Reunion Tower on Monday, April 8, 2024, in Dallas. (LE Baskow / LE Baskow)
Changing the culture of Dallas
The Texas Stock Exchange plans to have 100 Dallas employees based in its executive offices in an unannounced downtown location.
But experts like David Choate, COO of Dallas-based brokerage CAPIS, don’t believe the impact of the Texas Stock Exchange will be felt by the immediate jobs it brings to the area.
“Sorry, 100 more people downtown isn’t a game changer,” he said. “But we’ve seen this cultural shift over the last 30 years. It has more to do with the sense of credibility this brings to Dallas as a financial market. We have always been a financial center in the Southwest. But this puts us firmly on the map as competitors to New York and Chicago.”
If Dallas changes culturally to become more like New York or Chicago, financial meccas, as a result of the Texas Stock Exchange, experts predict that more outside companies will consider Texas as a viable state for their headquarters or offices, said Amirhossein Fard, assistant professor of finance at the University of North Texas.
“I think this could make Dallas a more attractive opportunity for local companies, especially in financial or legal consulting sectors that may be closely related to the stock market,” he said. “We are already seeing this now with the new Goldman Sachs Campus, but you can expect it to increase high-profile financial events and conferences and could stimulate new developments. But it could also increase property values.”
Dallas is already an important financial capital in the USA. There’s a Federal Reserve Bankbecame home to 24 Fortune 500 companies and it’s welcoming dozens of new rich residents.
It’s still trying to attract more companies that will call the city home through initiatives like Proposition Ga $72 million proposal for Dallas’ 2024 bond package that will allow the city to use incentives to attract businesses.
But for some, the Texas Stock Exchange, while an effective symbol of financial prestige, will not be enough to bring new companies to the region.
“I don’t know if the possibility of a company listing its shares on a Texas exchange would cause it to move its headquarters,” said Thomas George, Bauer Professor of Finance at the University of Houston. “But it will give people the opportunity to identify with Texas if they want.”
The Texas Stock Exchange’s strategy will be to target companies in the southeastern quadrant of the United States, from Texas to Florida, for listing. With more companies looking to regions beyond the Northeast due to proposed taxes on financial transactions, Dallas could be a big winner.
“Given the state’s recent economic success, it is very likely that companies will be willing to list on a Texas exchange, especially if its rules and protocols make it attractive,” said Ray Perryman, CEO of the Waco-based research firm , The Perryman Group. “The main challenge would probably be overcoming the inertia of the long-standing presence and prestige associated with New York.”
Can the Texas Stock Exchange compete with the NYSE and NASDAQ?
The Texas Stock Exchange has a difficult task ahead of it as it tries to challenge the New York Stock Exchange and NASDAQ. But Texas offers some competitive advantages that will serve you well.
Governor Greg Abbottis one of Lee’s assets.
He is proposed banning taxes on financial transactionswill appoint seven judges to Texas’ new business courts and calls himself a pro-business governor that will protect companies from cumbersome regulations. Texas also has no corporate income tax or personal income tax. Governor Abbott, unsurprisingly, supports the Texas Stock Exchange.
“Texas is America’s economic engine, so it’s only natural that Texas would launch its own national stock exchange. Governor Abbott was proud to work with the new CEO of the Texas Stock Exchange, James Lee, and his team to make this dream a reality,” Abbott press secretary Andrew Mahaleris said in a statement to The news.
“Business leaders are moving and investing in Texas at a record pace because we have built a structure that allows free enterprise to flourish and hardworking Texans to prosper,” he said. “In Texas, we will continue to cut red tape and protect industry from harsh job-killing restrictions and unnecessary regulations that burden innovators in other parts of the country.”
“Gov. Abbott is not going to run this. It is a private company that will be run by a board and these executives will make decisions independent of it,” said George, a professor at the University of Houston. “But the brand, being located in Texas, sends a message to companies that would otherwise be listed here about our intentions regarding extra requirements that Texas would not need.”