The exchange landscape has changed from its inception back in 1800s when the New York Stock Exchange was established with a handshake under a Buttonwood tree.
These days there are myriad exchanges, focusing on different pricing schema, order types, clients, etc. One of the newer exchanges is the Long Term Stock Exchange. It has yet to see a single order executed yet but the current environment is proving a tremendous opportunity for the exchange to test its systems and technology.
As per its website, its vision is to create a market designed to support the methods of experimentation and scaling that modern companies use to find continuous success; one that can open the way for innovation and value creation for all companies, far into the future.
So, how does this new marketplace survive and hopefully thrive during these times of heightened volatility and COVID-19 induced trading constraints? Traders Magazine spoke with LTSE’s Head of Trading and Market Operations Dan Amar to see how the newest and youngest stock marketplace is handling this new market dynamic.
TRADERS MAGAZINE: How have your systems held up amid COVID 19 concerns?
Dan Amar: We are fortunate to have a culture that supports distributed work. Our operations have continued to function with minimal impact as the team has risen to the challenge of the time we are in now. We plan for the possibility of interruptions using our Business Continuity process. There are always unknowns and things you can’t necessarily plan for, but we have a great team dedicated to the company mission and we feel confident about our ability to adapt.
TM: Have the market movements caused stress to your systems or technology?
Amar: We monitor for capacity and throughput. We are not yet operational, but market conditions haven’t exceeded the capacity we are building into our system. When you plan capacity for a new system like ours, you think about the worst-case scenarios and build accordingly. The financial crisis of 2008 presented financial markets with extreme levels of activity and, in my experience, demonstrated the importance of building resilient and scalable systems to handle this type of uncertainty.
TM: How do you view the COVID 19 phenomena? Is it an opportunity for markets to show resiliency?
Amar: My first thoughts are always for our people and their families — and by people, I am speaking of not only our employees, but also our customers and communities. We are working to make sure our team and their families feel supported during this pandemic. Our founder Eric Ries emphasizes daily that people come first.
Of course, as financial market participants, we know the importance of having resilient financial markets and we look forward to augmenting the capacity and resilience when we go live.
TM: What are you at LTSE doing to assist investors during this time of market stress?
Amar: We are lucky that customer feedback is built in the DNA of LTSE. When you hit turbulent times like this, being practiced at receiving and integrating feedback is vital. Also, we are reaching out to members to learn how they are and to ask what we can do to assist them. For example, we are providing more opportunities for testing so that they have enough preparation time amid everything else they are dealing with.
TM: How do you plan to navigate or are navigating this current COVID 19 market?
Amar: We are working from home and reaching out to stakeholders. Like many technology companies, remote collaboration tools have been part of our work from the start.
That’s not to suggest that there aren’t trade-offs to working from home, which, among other things, means we need to remember that everyone is balancing work, family, and all the rest of life that goes on throughout the day.
As the parent of children who are both home from college, I know first-hand the need to balance work with the well-being of everyone in our sphere.
TM: Is this an opportunity for LTSE as an exchange to add value and counter the fragmentation argument?
Amar: My hope is that all of us, together, will come through this pandemic, a stronger society with a renewed focus on the long term. We here at LTSE have recognized the value that comes from the ability of companies to source patient capital and operationalize resilience for the long term.
LTSE will not be, and was never intended to be, just another Exchange. Our Listing standards and company goals represent our commitment to supporting companies who pursue long-term strategies and growth, while considering a broader group of stakeholders and the critical role they play in one another’s success. At the same time, we operate as part of the national market system, and we take our role in that system responsibly.
Our focus is on building a platform for companies and investors alike for not only the present, but also for the future. We hope to be leaders in demonstrating the value from the ability of companies to source patient capital and operationalize resilience for the long term.