4.32 PM Friday, 23 February 2024
  • City Fajr Shuruq Duhr Asr Magrib Isha
  • Dubai 05:30 06:44 12:35 15:51 18:21 19:35
23 February 2024

New index possible

By Matt Smith

Abu Dhabi Securities Market has signed an agreement with NYSE Euronext that could lead to the creation of the Gulf’s first derivatives exchange.


The deal is the latest step in the ADSM’s ambition to become the leading global market based in the Middle East and is likely to pit it against the Dubai International Financial Exchange, which has long stated similar aims.


Director General Tom Healy, however, said he would be looking to co-operate as well as compete with other regional markets. “We don’t see our neighbours as our only competitors – people seem to confuse geography with market reach – and with electronic exchanges our competitors could be from any region,” said Healy.


“This strategic partnership will provide us with NYSE Euronext’s technology and expertise to develop our business and our strategic goal of internationalising the ADSM.

“We want to be the international gateway to the region and to do this we will develop new product areas such as derivatives.”


Healy said consultation work on creating an ADSM derivatives market would now begin.

Estimates vary on the potential size of a Gulf derivatives market, with the most hopeful predicting that within five years it could claim a quarter of the region’s equities turnover, which last year topped $1 trillion (Dh3.6trn). Derivatives is virtually non-existent trading at present.


The ADSM will pursue cross listings from the Gulf and Asia, Healy said.

“This would allow both ETFs (exchange traded funds) and outside companies access to Abu Dhabi,” he said.