Mar 26 2012
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Equity powerhouse ADS seeks to become a trading powerhouse
Monday, Mar 26, 2012
Abu Dhabi Abu Dhabi Source Securities, also known as ADS Securities , the Abu Dhabi-based forex (FX) and commodity trading partner, has just turned a year old. The company, which has a $400 million (Dh1.46 billion) capital, wants Abu Dhabi to become a significant contributor to the global marketplace. It currently owns two platforms and is in the process of buying a new and more advanced one.
The company makes an average of $2.5 billion to $4 billion of profitable volume for its clients per day, and by the first quarter of 2013 it hopes to reach $10 billion per day, its vice-chairman and managing director Phillippe Ghanem said.
Gulf News met Ganem to talk about ADS Securities’ objectives, the risks in the marketplace and how investors can benefit from their services.
Philippe GHanem: The objective is to grow, and to be able to hear one day people in the market asking for prices from the London, Zurich, Hong Kong and Abu Dhabi. So people would ask ‘What is Abu Dhabi quoting the euro?’ because we are four hours earlier.
These people will make money and spend it in the economy of Abu Dhabi.
Our partners are coming here — the banks are moving closer to ADS Securities because they know it’s going to be a marketplace and it automatically creates competition.
We need competition and we invite the institutions to come and work with us.
Has it been hard to launch such a platform in the region?
Yes it’s been hard. We’re from Abu Dhabi. There’s a lot of credibility there, but no one has done this before. It’s something new. It’s not the local stock exchange that closes at two. It’s 24 hours. It’s a business with high volumes. It’s a business where people expect a lot from you — a lot of answers.
For a prospective investor, what’s in it for them to trade via ADS Securities ? How can they benefit from such a platform?
ADS Securities is a new concept to the Mena, GGC and the UAE as we provide a sophisticated trading platform offering clients the level of service, price and execution normally available to institutional FX investors [banks, hedge-funds and brokerages].
Professional, individual, traders in the region have only had access to satellite forex operations who then manage their accounts from trading floors many thousands of kilometres away. These companies see the region as a market they can take revenues from, but they do not see the importance and potential of having a well-developed regional FX market.
ADS Securities provides the best service to customers, with servers; back office and front office teams, all based in Abu Dhabi, but we also understand the importance of developing a strong trading platform which gives back to the region.
At ADS Securities we are extremely proud of the fact that in one year we have grown from zero volume to a level when we trade in billions of dollars a day.
We provide some of the best prices available anywhere in the world, across major currencies, bullions and commodities. The company is just starting out and we will continue to introduce new products and services which will benefit all traders in the region. Traders have the opportunity to impact global markets by trading from the Middle East.
FX trading underlines almost every financial transaction, wherever you are in the world. Whether you are buying equities, bonds or real estate, currency changes hands and margins are made on this trading. The ADS Securities platform gives investors access to a very liquid and tradable asset class which for many years has been available only to banks and institutions.
What are the risks of such trading?
Any trading involves risks, but we know that trading is almost second nature to investors in the region, and they are aware of what they are entering into. What we do encourage is that anyone who has not traded in forex before, receives the right introduction and training and we will be opening our own training facility in May which will provide support to all our clients.
Understanding FX markets is vital, but the advantages of trading forex are also very clear. The liquidity that exists means that positions can be opened and closed when clients want. Even with the on-going global financial market issues it is possible to trade effectively and potentially make levels of returns that investors in traditional asset classes haven’t seen for many years.
What’s the trend in the market today?
Up to the last month, everyone focused on the euro because every time someone [a politician] spoke [about the Eurozone] the volumes would go up or down. People now are becoming more sophisticated and are looking into real markets.
It looks like something is going to happen with the yen. We need to look into that market. I’m not saying you need to sell it, but you need to look into it. Japan has a lot of added value and needs to sell its products, but they can’t sell if it’s hugely expensive. In Europe, they’re losing the focus. It’s a lot of work. Europe needs to work much more.
However, the FX market is the most tradable market today and it will stay like that. It will not change. It will always increase. There will always be a battle for currency unless it becomes gold, all gold. So people will always shift from currency to currency.
By Samia Badih ?Staff Reporter
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