The Abu Dhabi Securities Exchange (ADX) plans to double market capitalisation over the next three years by increasing liquidity and improving market efficiency, the exchange said in a statement Wednesday.
A new strategy called “ADX One”, which includes new listings, launch of derivatives trading and research coverage, aims to adopt best international practices and make the exchange more attractive for foreign investors, the exchange said in a statement Wednesday.
The new strategy comes as the market capitalisation of companies listed on the ADX rose 40 percent in 2020 to a record 750 billion dirhams. The market value of foreign-owned shares in ADX-listed companies topped 60 billion dirhams at the end of December last year.
The ADX is the second-largest exchange in the region, behind Saudi Arabia’s Tadawul. Among its heavyweight listings are First Abu Dhabi Bank and Etisalat.
Mohamed Ali Al Shorafa Al Hammadi, the chairman of ADX, said: “Our strategy will deepen our market strength and draw in new sources of liquidity while ensuring Abu Dhabi’s diversified, competitive, and transparent economic system that is attractive for local, regional and international investors. Over the coming years, ADX will continue to leverage Abu Dhabi's unique regulatory environment, infrastructure and stability to stimulate long-term growth across the Emirate and more than double the market capitalization over the next three years."
Throughout 2021 ADX is also expecting at least ten new listings, including three exchange-traded funds (ETFs). New listings will also be made on the fast-growing Second Market.
The introduction of derivatives by the fourth quarter will allow institutional investors to hedge their investments and allow to execute complex trading strategies, the exchange said.
Meanwhile, trading volumes on ADX recovered from the lows in March to end 2020 marginally lower at 5,045.332. Total value of trades rose 28 percent year-on-year to 72.8 billion dirhams.
(Reporting by Brinda Darasha; editing by Seban Scaria)
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