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Stock exchanges as platforms for data and trading

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  • Hendershott, Terrence
  • Rysman, Marc
  • Schwabe, Rainer

Abstract

We study linkages between stock exchanges' proprietary data sales and trading activity by analyzing the introduction of a new data product, the New York Stock Exchange's Integrated Feed (NYSE IF). Consistent with trading and data being complements, firms that subscribed to the NYSE IF increased their share of trading on the NYSE. In principle, firms subscribing to the NYSE IF could impose a negative externality on non-subscribing firms due to increased information asymmetry. However, consistent with information purchases having a positive network externality due to increased liquidity, non-subscribing firms also increased their share of trading on the NYSE.

Suggested Citation

  • Hendershott, Terrence & Rysman, Marc & Schwabe, Rainer, 2025. "Stock exchanges as platforms for data and trading," Journal of Financial Markets, Elsevier, vol. 75(C).
    • Handle: RePEc:eee:finmar:v:75:y:2025:i:c:s1386418125000266
    DOI: 10.1016/j.finmar.2025.100986
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    JEL classification:

    • G10 - Financial Economics - - General Financial Markets - - - General (includes Measurement and Data)
    • L50 - Industrial Organization - - Regulation and Industrial Policy - - - General

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