Average daily trade volume in derivatives triples on Nasdaq Dubai

Reflecting the increasing awareness about hedging mechanism, the average daily volume in derivatives on Nasdaq Dubai more than tripled this month so far, when compared to the previous month.

The total volume in February so far is at 340 million  shares as against 171m shares in January, while the average daily trading volume (ADV) tripled to 21.2m shares from 6.8m shares.

“Nasdaq Dubai has demonstrated that it can be a platform for high liquidity. We look forward to building our market further with growing participation from both retail and international investors,” an official spokesman of Nasdaq Dubai told Emirates Business.

During 2008, the total volume on Nasdaq Dubai more than doubled to 2.39bn shares from 1.1bn shares in 2007. And the average daily volume during the period was up at 9.6m shares from 4.4m shares.

“Nasdaq Dubai demonstrated in 2008 that it can be a platform for high liquidity. In Q4 2008, DP World traded higher volumes than 91 per cent of the stocks on the Dubai Financial Market and 95 per cent of the companies on the Abu Dhabi Securities Exchange. In the same period Depa traded higher volumes than 73 per cent of DFM stocks and 78 per cent  of ADX stocks, while Damas traded higher volumes than 58 per cent of DFM stocks and 38 per cent of ADX stocks,” the spokesperson said. The trading volumes on Sunday trading, which took off in December 2008, is recording positive response from investors as participation is gaining momentum.

Sunday trading volumes were up at 1,715,000 securities in January 2009 from 591,000 in December 2008. Nasdaq Dubai added on Sunday trading as part of its strategy to facilitate access to regional investors, who are accustomed to trading on Sundays on other GCC stock markets.

“Trading volumes on Sundays have increased since we started opening on Sundays last November, and four  more local brokers have joined the exchange since November – Mashreq Securities; Union Brokerage Company; Al Ramz Securities; and Direct Broker for Financial Services (Mubasher),” said the spokesperson.

Nasdaq Dubai is building awareness about secondary listings among investors as many of Nasdaq Dubai’s secondary equity listings have recorded substantial trading volumes on their primary markets in 2008.

Four brokers have joined Nasdaq Dubai directly from the regulatory jurisdiction of the UAE since November 2008. The new members are: Mashreq Securities; Union Brokerage Company; Al Ramz Securities; and Direct Broker for Financial Services, the operator of the Mubasher Trade online trading system. These brokers help provide a healthy regional balance to the exchange’s international institutional liquidity.

Jeff Singer, CEO, Nasdaq  Dubai, said: “Options traded on-exchange have the potential to become a major asset class in the region as investors seek to insure against risk.” Nasdaq Dubai has decided to launch equity options this year subject to the regulatory approval following the launch of its equity futures market in November last year.

 

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