National Stock Exchange

National Stock Exchange

Investopedia / Tara Anand

What Is the National Stock Exchange?

The National Stock Exchange, better known by its abbreviation "NSX," was the first stock exchange in the United States to transition to 100% electronic trading. In 2017, the NSX was acquired by the New York Stock Exchange (NYSE) and is now known as the NYSE National.

Key Takeaways

  • The National Stock Exchange, originally founded in 1885, was a stock exchange known for its railroad and financial firms.
  • It was an early adopter of computerized trading technologies.
  • Today, the National Stock Exchange is part of the NYSE, where it is known as the NYSE National.

Understanding the National Stock Exchange

The NSX was founded in Ohio in 1885, at which time it was known as the Cincinnati Stock Exchange. For much of its early history, it was known for its listings of railroad companies, banks, and insurance firms.

The Cincinnati Stock Exchange was an early adopter of computerized trading technologies, closing down its physical trading floor in 1976 in favor of fully electronic trading. In 1995, it relocated to Chicago, Illinois, and then changed its name to the National Stock Exchange in 2003. It later moved again, this time to New Jersey.

In May 2014, the NSX ceased trading due to low transaction volumes, but it was able to reopen a year and a half later. These problems persisted, however, with the NSX announcing in Dec. 2016 that it would once again need to pause trading.

At the time of its 2016 announcement, the NSX accounted for roughly 0.02% of volume in United States equity markets. In an effort to reclaim market share, the NSX merged with the NYSE, rebranding itself as the NYSE National.

Today, the NYSE National operates as part of the NYSE Pillar trading platform, which seeks to combine several NYSE-affiliated markets into a comprehensive order fulfillment system. Through this new platform, the NYSE National resumed trading in the second quarter of 2018.

Real World Example of the National Stock Exchange

The term "National Stock Exchange" can also refer to stock markets in India or Australia. In India, the National Stock Exchange (NSE) is the nation's most prominent stock exchange. 

In Australia, the National Stock Exchange is that nation's second largest stock exchange. Also known as NSX, it specializes in growth companies.

Article Sources
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  1. National Stock Exchange. "History (Archived)." Accessed Nov. 10, 2020.

  2. National Stock Exchange. "CSE Announces Name Change to National Stock Exchange (Archived)." Accessed Nov. 10, 2020.

  3. National Stock Exchange. "The National Stock Exchange Relaunches Trading Operations (Archived)." Accessed Nov. 10, 2020.

  4. Business Wire. "NYSE Agrees to Acquire National Stock Exchange." Accessed Nov. 10, 2020.

  5. Cboe. "U.S. Equities Market Volume Summary for Dec. 16, 2016." Accessed Nov. 10, 2020.

  6. U.S. Securities and Exchange Commission. "NYSE National Inc. Form 19b-4," Pages 3-4. Accessed Nov. 10, 2020.

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