SEC Approves Use of 3-Letter Tickers on Nasdaq
The Securities and Exchange Commission approved a plan to allow companies listed on the New York Stock Exchange to retain their three-letter ticker symbols should they transfer to rival Nasdaq Stock Market.
Traditionally, investors have been able to differentiate between companies traded on the Nasdaq and other exchanges based on how many letters a stock symbol contains.
The American Stock Exchange uses three characters, while Nasdaq-listed companies use four or five characters.
The Nasdaq has argued that allowing companies to retain their three-character symbols would increase competition. It would have allowed San Francisco-based discount brokerage Charles Schwab to keep its "SCH" symbol when it switched to the Nasdaq last year. It now trades under the ticker symbol "SCHW."
The SEC said in its decision that removing the three-letter symbol rule would "remove a burden on competition not necessary or appropriate." The regulator also said it would reduce confusion among investors of companies that may switch.
The new rule will not apply to NYSE companies that have symbols with one or two letters, and it won't allow Nasdaq to list new companies with three-letter tickers.