What is the Long-Term Stock Exchange and who is it for?
The Long-Term Stock Exchange (LTSE) is an SEC-registered national securities exchange built for companies and investors in every industry who share a long-term vision.
How does the Long-Term Stock Exchange differ from other stock exchanges?
The exchange is the only U.S. national securities exchange built to support companies and investors who share a long-term vision. To list their shares on the exchange, companies are required to publish and maintain a series of policies that are designed to provide shareholders and other stakeholders with insight into their long-term strategies, practices, plans and measures.
What are the benefits of listing on the Long-Term Stock Exchange?
Listing on the exchange helps companies operationalize the long term. Taken together, the long-term focused listing standards and the binding commitment to adhere to them are designed to help companies:
- Offer metrics beyond price-determined benchmarks that investors can use to value the company’s performance over the long term
- Preserve the flexibility for management to innovate consistently and to invest in initiatives that pay off over time
- Better align with requirements for the growing share of investment capital allocated according to environmental, social and governance (ESG) mandates
- Reinforce resilience by aligning with employees, customers, communities and other stakeholders
How will the Long-Term Stock Exchange support companies and investors who focus long term?
By making their long-term strategies, practices, plans and measures public, companies that list on the exchange offer investors, employees and other stakeholders a more holistic understanding of how the company is governed to deliver value over years and decades. That aligns them with investors who share their time horizon and provides incentives and obligations to maintain a long-term focus in both operations and strategy.
What stocks trade on the Long-Term Stock Exchange?
In short, all stocks. The exchange offers trading in all U.S. exchange-listed securities. A fundamental feature of the U.S. equities markets is that stocks are not restricted to trading only on the primary listing exchange. Stocks listed on exchanges such as the NYSE or Nasdaq can trade on LTSE and vice versa.
What kinds of companies stand to benefit from the Long-Term Stock Exchange?
LTSE offers companies in every industry a public-market option that supports consistent innovation, ties with long-term shareholders, and alignment with employees, customers and other stakeholders. The exchange offers an option to dual list for companies that are either public already or that are planning to go public.
What are the requirements for listing?
Besides meeting financial and governance thresholds that mirror those of other U.S. exchanges, companies that list on LTSE are required to publish and maintain a series of policies designed to provide shareholders and other stakeholders with insight into their long-term strategies, practices, plans and measures.
What does the Long-Term Stock Exchange mean by a principles-based approach?
The long-term policies that companies are required to adopt must be consistent with five principles, which offer companies guidance as to the key elements, while providing flexibility for diverse companies from a broad range of industries. LTSE has eschewed a prescriptive, one-size-fits-all approach and believes that companies can manifest their focus on the long term in myriad ways. The principles hold that long term-focused companies consider a broad group of stakeholders, measure success in years and decades, align compensation of executives and directors with long-term performance, engage directors in long-term strategy (and grant them explicit oversight of this strategy), and engage long-term shareholders.
Why are short-term pressures a problem for public companies?
Short-term pressures can cause companies to undermine the creation of value over the long term to satisfy expectations from one financial quarter to the next. Managing a company for the sake of the short term runs counter to a philosophy of long-term thinking that research shows contributes to the creation of value over time.
What provisions with respect to voting does the Long-Term Stock Exchange require?
None. There are no voting rights provisions in the rules of the exchange. Issuers can structure the rights for their shares in any of the ways that current law and regulations allow.
Would investing in a stock on the Long-Term Stock Exchange prevent shareholders from trading the stock?
No. The Long-Term Stock Exchange will not impose holding periods, lockups or any other restriction on securities listed or traded on it.
Does the Long-Term Stock Exchange reward long-term investing by offering shareholders more of a say the longer they own their shares?
No. The exchange’s rules do not take a position on enhanced voting rights for shareholders. Our software affiliate, LTSE Services, has designed a tool to facilitate enhanced voting, should a company choose on its own to implement that.
Will companies that list on the Long-Term Stock Exchange be able to use dual-class shares?
Yes. Like every other exchange, the Long-Term Stock Exchange permits companies to adopt more than one class of shares. It is generally up to a company to determine its share structure.
It has been said that the Long-Term Stock Exchange is Silicon Valley’s exchange. Is that accurate?
The Long-Term Stock Exchange is for companies in every industry that aim to build sustainable businesses and advance their visions over time.
Would companies that list on the Long-Term Stock Exchange report quarterly earnings?
Yes. By law, U.S. public companies are required to report earnings at least quarterly. The difference is that the listing standards of the Long-Term Stock Exchange are designed to change the narrative for success, so that the quarterly results are viewed in context as part of a long-term narrative.
The Long-Term Stock Exchange aims to encourage companies to go public. But isn’t a large share of the economy being driven by privately held companies?
Thanks to both an abundance of private capital and short-term pressures in public markets, companies are staying private longer. That comes at a cost to all of us, including workers who rely on retirement accounts that invest in public company stocks. By the time some companies finally do go public, investors may have missed the opportunity to profit from the innovation that the company pioneered while private. As a public-market option designed to alleviate short-term pressures, LTSE offers companies built for innovation the ability to pursue investments and advance their vision over time while building bonds with long-term shareholders and other stakeholders.
Will companies be able to list on both the Long-Term Stock Exchange and another exchange?
Yes. We designed our exchange so that it can accept dual listings; another exchange can be the primary exchange and the Long-Term Stock Exchange can be secondary.
Who can be a member of the Long-Term Stock Exchange?
The exchange is open to any registered broker-dealer who is a member of at least one other national securities exchange and is able to clear trades. Members also can register with the exchange as market makers.
How might the Long-Term Stock Exchange affect broker-dealers?
Broker-dealers with whom we speak welcome a stock exchange that they can interconnect with easily and trade on at low cost, and that offers companies an alternative lens through which they can consider accessing or operating within the public markets. LTSE’s focus on addressing the interests of companies rather than on revenue from trading and data holds the potential to strengthen ties between broker-dealers and their customers.