LTSE Listing: The Long-Term Stock Exchange

Key Takeaways

• Long-Term Stock Exchange listing requires meeting standard financial bars plus 5 governance policies.
• The LTSE became an SEC-approved national securities exchange in 2019 and took its first listings in 2021.
• Investors often assume the policies are binding rules, when they mostly require disclosure of an approach.
• Most companies dual-list on LTSE while keeping a primary listing on the NYSE or Nasdaq.

What It Is

The Long-Term Stock Exchange is a US national securities exchange that the SEC approved to operate in May 2019. It was built on the idea that public markets push companies toward short-term results, and that an exchange can encourage a longer horizon through its listing standards.

Financially, LTSE listing rules draw on the same kinds of quantitative bars used elsewhere: measures of size, share distribution, and price. The difference is an added layer of governance. To list, a company must publish five policies describing how it pursues long-term success. The exchange filed these policies with the SEC and they were approved as part of its rulebook.

The Intuition

A quarterly earnings cycle can reward decisions that boost the next report at the expense of years ahead. The LTSE premise is that disclosure changes behavior. If a company has to state, in public, how it weighs stakeholders, how it sets strategy, how it ties pay to long-term metrics, and how its board oversees the long view, those statements create accountability.

The policies do not dictate one correct answer. They require the company to articulate its own approach. Investors who care about governance can then read those policies and judge for themselves whether the words match the actions.

How Long-Term Stock Exchange Listing Works

A company seeking to list must adopt and publish five long-term governance policies.

LTSE long-term governance policies (all five required)
  1. Stakeholders   how the company considers stakeholders critical to
                    long-term success
  2. Strategy       how it prioritizes long-term decision-making
  3. Compensation   how executive and board pay align with long-term metrics
  4. Board          how the board oversees long-term strategy
  5. Investors      how it engages long-term shareholders

Because LTSE is a younger venue with thin native trading, almost every company uses a dual listing. The company keeps its primary listing on the NYSE or Nasdaq, where most volume happens, and adds an LTSE listing on top. Twilio and Asana were the first to dual-list in 2021, with both keeping their NYSE primary listings, and ThredUp followed in 2023.

Worked Example

Suppose a software company already trades on the NYSE and wants to signal a long-term posture. It does not need to move its primary listing or change exchanges for trading purposes.

Instead, it drafts the five required policies. It writes how it consults employees, customers, and communities; how it sets multi-year strategy; how its executive pay vests against long-horizon targets; how the board reviews that strategy; and how it talks to long-term holders. After review, it dual-lists on LTSE while its shares keep trading mainly on the NYSE.

For an investor, the value is the disclosure. The trading mechanics and the share are unchanged, but the company has now committed, in writing and on an SEC-registered exchange, to a stated long-term framework.

Common Mistakes

1. Thinking LTSE replaces a primary listing. Most companies dual-list and keep their NYSE or Nasdaq listing for trading.
2. Reading the policies as hard rules. They mainly require a company to disclose its approach, not to follow a fixed formula.
3. Assuming a long-term label guarantees results. A published policy is a commitment to disclose, not a promise the stock will outperform.
4. Expecting deep native liquidity. LTSE trading volume is light, so price discovery still happens on the primary venue.
5. Confusing governance disclosure with financial strength. The five policies say nothing about a company's balance sheet or earnings.

Frequently Asked Questions

What is Long-Term Stock Exchange listing in simple terms? Long-Term Stock Exchange listing means a company lists on an SEC-approved exchange that asks it to publish five policies on long-term focus. Most companies do this in addition to a primary NYSE or Nasdaq listing.

How does Long-Term Stock Exchange listing affect investment decisions? The five governance policies give you a documented view of how a company says it balances long-term and short-term goals. You can compare those statements against actual behavior, but the listing alone is not a quality signal.

What is a real-world example of Long-Term Stock Exchange listing? Twilio and Asana dual-listed on LTSE in 2021 while keeping their NYSE primary listings, and ThredUp dual-listed in 2023, each publishing the required long-term governance policies.

How can investors use Long-Term Stock Exchange listing effectively? Read the five published policies as a governance document, then check whether pay, strategy, and board oversight actually match the stated long-term commitments rather than taking the label at face value.

How is Long-Term Stock Exchange listing different from a regular NYSE listing? A regular NYSE listing requires only financial and distribution standards. LTSE listing adds five long-term governance policies and is usually a dual listing layered on top of a primary exchange.

Sources

1. LTSE. Listing Standards. https://ltse.com/listings/listing-standards
2. LTSE. Listings FAQs. https://ltse.com/listings/faq
3. U.S. Securities and Exchange Commission. Self-Regulatory Organizations. https://www.sec.gov/divisions/marketreg/mrexchanges.shtml
4. LTSE. Dual Listing Process Simplified. https://ltse.com/dual-listing-process-simplified

Disclaimer

This article is educational content only and is not financial advice. Nothing here is a recommendation to buy, sell, or hold any security. Consult a licensed advisor before making investment decisions.