Shutterstock / Frank Parker
Texas is home to more Fortune 500 companies than any other U.S. state.
With Texas Gov. Greg Abbott enforcing his own border policies and TEXIT gaining momentum with the state’s Republican Party, perhaps we shouldn’t be surprised that the state is taking another step toward becoming a semi-autonomous region.
To that end, the Lone Star State is launching its own stock exchange.
Houston financier James H. Lee, backed by a $120 million investment from asset management firms BlackRock and Citadel Securities, plans to launch the Texas Stock Exchange next year, the Wall Street Journal reported Tuesday.
It’s worthing noting that BlackRock has been at the center of several controversies, most recently being accused by a U.S. House subcommittee of compromising U.S. national security by investing in blacklisted Chinese companies. Meanwhile, Citadel has paid millions in fines since 2014 for trading irregularities and violations.
Nonetheless, the operators of the Dallas-based exchange hope it can compete with the New York Stock Exchange and Nasdaq, challenging those exchanges increasingly high compliance costs and new rules including setting targets for board diversity, the Journal reports.
Lee, whose four decades of work experience includes time at First Boston Corp., E*Trade and the now-defunct Lehman Brothers, wants the TXSE to make its first trade in 2025 and put up its first stock listings in 2026, according to the Dallas Morning News.
“It is exciting; it’s transformational,” Lee told the Morning News. “Frankly, it could change the arc of Dallas for decades. It’s the destiny of this technology infrastructure, market participants and the network effect that makes Dallas a major financial hub.”
The TXSE will focus on attracting companies from Texas and surrounding states to list their stock. Texas is home to more Fortune 500 companies than any other U.S. state, and Charles Scwabb, Tesla and Hewlett Packard all relocated her in the past three years.
“Texas is already the ‘headquarters of headquarters,’ with 52 Fortune 500 companies calling our state home, making us an ideal for for the nation’s newest stock exchange to compete with the current duopoly of NYSE and Nasdaq,” The Texas Association of Business said in a statement. “CEOs have continually named Texas the Best State for Business for the last two decades, while Site Selectors have consistently chosen Texas as the top state for new capital investment projects for 12 years and counting.”
It’s not Texas’ first foray into the world of financial markets, however.
Last year, Texas Capital Bank launched the Texas Capital Equity Index (TXS), an Exchange Traded Fund (ETF) based on the values of publicly traded Texas-based companies, including Exxon Mobil, Waste Management and American Airlines, among others.
However, the TXS index hasn’t received much fanfare in this Bull market. Its shares have bounced between $24 and $28 since being launched last July.
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