The new name was selected to reflect the Exchange's expanded position in the U.S. securities industry. Setting a new daily record of 451 million shares on October 30, 2003 and a record 913,799 trades on September 24, 2003, and trading more than 4,800 issues of NYSE, Nasdaq and Amex-listed stocks, NSX ranks as one of the largest stock markets in the United States.
"We are proud of our Cincinnati origin, but we are no longer a regional exchange," said NSX President and Chief Executive Officer David Colker. "We are national in scope, which is evident in the breadth of stocks we trade, the geographically-diverse broker-dealers we attract, and the market share we command.
"In fact, the geographical location of stock markets has become irrelevant because of our Exchange," Mr. Colker said. "By introducing the nation's first all-electronic stock exchange in 1980, we enabled members to interact with an exchange from the convenience of their offices for the first time, eliminating their need to maintain remote floor operations. Today, some 20 years later, our all-electronic exchange model is being imitated across the industry. It is time for the Exchange responsible for this sea-change to adopt a name that reflects its national reach, rather than the physical location of its birthplace."
The name change will also eliminate any confusion that may have resulted from the fact that the Exchange's corporate office is based in Chicago, while the Exchange's former name referenced Cincinnati.
A History of Innovation
NSX's creation of the nation's first all-electronic stock exchange contributed to the growth that ultimately spurred the Exchange's name change. However, it is only one of many industry innovations for which NSX is responsible. Committed to being the low-cost provider of exchange services, NSX has been a driving force for change in the world of securities exchanges. One example of such innovation is the revenue-sharing program that NSX pioneered for its members in 1998. Called the Specialist Operating Revenue (SORSM) program, this program has provided substantial cost-efficiencies to the broker-dealer community and public investors, and is now being duplicated by other market centers.
NSX also developed the National Securities Trading System (NSTSSM), which automatically performs all functions of an auction market and facilitated the advent of its all-electronic platform.
NSX introduced the competing specialist system, which allows any NSX member to make markets in any given stock. NSX was the first exchange to combine this system with preferencing, introducing elements of a decentralized market structure into an exchange for the first time and creating a more competitive environment for exchange-listed securities.
Also included among its many innovations, NSX introduced the first automated exchange interface with the Intermarket Trading System (ITS). In addition, NSX was the first exchange to develop an electronic order audit trail, a comprehensive system known as Firm Order Submission (FOSSM) audit trail that has become a model for the industry.
As the low-cost provider of exchange services, NSX has been the source of dramatic changes in exchange trading of securities. The newly named National Stock Exchange is committed to delivering the cost-efficient service and advanced technology that have made it a proven alternative to the primary markets.
