I read this article and skimmed the original and I'm still not sure what the exact details of this exchange are. No robo/quant investing? Minimum hold periods? No requirements for quarterly earnings? No penny stocks?
There is no difference in incentives on the market itself. They just make the companies which are traded on their platform sign an agreement before they are allowed to be traded.
I think in practice this means that no one will use this exchange...
> Operating principles: In an earlier SEC filing, LTSE said that its corporate governance rules might include: increased voting rights for shareholders who hold company stock for long periods of time, restrictions on offering short-term incentives to executives, disclosure of impact of any stock buybacks, and requiring companies to have a board-level long-term product and strategy committee.
This would add a level of indirection to stockholders trying to influence the company though, right? You have to make the fund managers put pressure on the company to give you short term gains, rather than pressuring the company directly.
In a prior post the founder claimed that there are ways to deal with that. After all, AIUI stocks in the States are already actually held by the Depository Trust Corporation, so the system already deals with indirection.
Agreed. I suspect that it's more like "The Stock Exchange For LongTerm(TM) Certified Companies", so more like the requirement that exchange-listed companies are at least 70% public.
Presumably that could mean requirements on board memberships, dividend levels, types of employment perhaps? I find it a bit hard to see what stipulations they would have that aren't just good governance.
Same here. I was looking all over the site for "the idea" or the differentiator ... couldn't find it.
I think most of the approaches you mentioned wouldn't hold up for a large stock exchange because some off-platform trading site would spring up to fill the gaps. For example, you have a minimum holding period, but off-platform you can "sell" your shares at the current market price, then transfer them for free once the holding period ends. Or something.
I think you have to change the way the shares themselves work somehow (or how dividends work, etc). I'm not sure, seems like a hard problem.
It looks like a SaaS analytics platform. Maybe they will have different data than normal Quarterly reports coming in from companies who want to be part of the exchange.
Porsche SE was banned from certain stock indexes because they refused to publish quarterly reports. They claimed that too frequent reporting is not beneficial for companies. You can purchase Porsche SE stocks, but they are not listed in the DAX, which is the largest German stock index.
I think in practice this means that no one will use this exchange...