Private stocks poised to dethrone public
As unlisted securities become more attractive to investors and companies, they pose a growing challenge to the dominance of public stock exchanges.
PUBLIC stock exchanges have been around for centuries, with initial public offerings (IPOs) long marking the holy grail for companies and their investors. Not only are IPOs traditionally revered as a symbol of triumph for companies, they pave the way for king-sized fundraising through the mass issuance of company shares.
In recent years, however, a different breed of stock exchanges has been growing in traction, and is even tipped to challenge the dominance of and need for public stock exchanges entirely. They are the private stock exchanges, which are platforms for investors and private companies to buy and sell those companies' shares.
Known as unlisted securities, shares of privately-held companies are becoming an increasingly attractive, accessible asset to investors. Take the Nasdaq Private Market, one of the world's largest private exchanges. In 2018, it recorded US$12 billion in transaction volume, nearly quadruple that of the US$3.2 billion recorded in 2017 - a testament to investor demand and value in its offerings.
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