NYSE Euronext's deal with Deutsche Boerse was a "calculated risk" whose failure means the owner of the New York Stock Exchange must grow from within, CEO Duncan Neiderauer told CNBC Monday.
"I’m still glad we tried. It was a calculated risk but it didn’t get done. So we quickly shift gears," he said.
The deal was blocked by European regulators on Feb. 1.
The deal would have given the NYSE's derivatives business broader access to more markets in different areas but now "some of the products that that deal was going to get us into we’ll have to get into organically," he said. The NYSE will also now build up its own clearinghouse business, plans for which had been put on hold during the deal talks.
In addition, there'll be some belt-tightening, more vigilance on expenses and running the business more efficiently, he said.
But more important is "how we deploy our capital" including the current half-billion-dollar stock buyback, maintaining a dividend and "cleaning up the portfolio. You’ll see us invest in some growth initiatives and maintain the growth initiatives we’ve been focused on," Neiderauer said.
He said the market's current volatility is a "double-edged sword" — in the first two months of this year "roughly 35 percent of the stocks traded in the U.S. market, no matter where they’re listed, are trading away from public exchanges. But lower volatility does mean stability and you see the market creeping up this year...So maybe it's starting to turn."