Is The NYSE Moving To Texas?

While I mainly discuss entrepreneurship and technology trends, I still have a soft spot for trading, which remains a large part of what we do at Capitalogix. While we've broadened the industries in which we use our Capitalogix Insight Engine, it was originally built with trading technologies in mind. We have exciting new partnerships there, including a new fund.

As we look forward, I thought it was a good time to look back as well.

I'm sure you have heard about open outcry trading pits in Chicago and New York—where traders flashed hand signals lightning quick to buy and sell commodities like cattle, corn, gold, and pork bellies. Those pits, which were made famous in the movie Trading Places, thrived for decades. Nevertheless, the practice has lost out to a faster, cheaper, and quieter competitor: the computer and electronic trading.

In 2016, I visited the Chicago Mercantile Exchange and took this video in front of the S&P trading pit during live trading hours. 

 

via my YouTube Channel.

In the video, I remarked that even though it looked empty - trading volume was higher than ever. Meaning that trading had once again evolved beyond the way it used to happen. According to the CME Group, by 2015, public outcry had fallen to 1% of total volume. Here is a video of what the S&P trading pit used to look like.

 

"...the change in the pit isn't a harbinger of death for futures trading;  it's the signal of a new era." 

 

At the time, it didn't feel like a bold statement to me – because what was coming felt inevitable. And it has proven to be true. Markets have changed radically since 2016. And you can bet that the changes aren't done, as AI and exponential technologies promise to transform markets and trading again.

The process of trading and clearing is moving beyond human capabilities. As the old duties of the Exchange fade away, the focus must be on the dangers, opportunities, and strengths of a bigger future. That means new games to play, new risks to navigate, and a new set of rewards to capture.

 

Nearly empty CME trading pits in 2016 (specifically, the S&P and Eurodollar)

The new game involves not only new players, methods, and markets ... but also a new geography.

Yes, as more things become digital, geography still matters.

In 2018, the Intercontinental Exchange acquired CHX and rebranded it to the NYSE Chicago. Now, that branch of the NYSE is moving to Dallas. 

This follows announcements in 2024 of the launch of the Texas Stock Exchange, which has backing from people like Rick Perry. 

Texas is rapidly becoming an even larger economic hub. It boasts the highest number of NYSE listings, Nasdaq recently established a large base here, and companies representing more than $3.7 trillion in market value list Texas as their headquarters.

Meanwhile, lawmakers are pushing to make Texas even more business-friendly. With no corporate or personal income tax, Texas has one of the lowest tax burdens in the nation. The state also offers incentives for corporations to relocate.

All of this can be taken as a reminder that opportunities, talent, and resources concentrate where energy and funds flow. 

If you want to talk more about how to launch a business in Texas or anything Capitalogix is working on, reach out.