Dubai financial bourse lists equity derivatives

November 19th, 2008 - 7:57 pm ICT by IANS  

Dubai, Nov 19 (IANS) The financial stock exchange in this west Asian metropolis, to be called Nasdaq Dubai from Nov 20, announced Wednesday that it has listed equity derivatives for the first time.Created by the exchange itself, the derivatives consist of futures contracts on an index of the United Arab Emirates (UAE) shares, according to a statement issued by the bourse.

“Nasdaq Dubai’s equity derivatives platform has great potential to develop into a substantial market,” Nasdaq Dubai chief executive Jeff Singer said in the statement.

“It will cater initially for institutional investors and in due course also for individual investors. We intend to introduce further equity futures contracts as well as options,” he added.

According to Singer, equity derivatives would play a beneficial role at the time of this global financial crisis.

“They enable investors to hedge risk, and can increase trading volumes in the underlying stock as well as reduce volatility in its price,” he said.

Susquehanna International Securities (SIS), a member of the Susquehanna International Group of Companies (SIG), has been selected as a market maker in the derivative products, according to the statement.

“We are honoured to have been chosen by Nasdaq Dubai to be the leading market maker in these products,” John Keogh, director of co-chair of SIS’ management committee, said in the statement, adding that SIS has been leading innovation in the financial market for over 20 years now.

Established as Dubai International Financial Exchange (DIFX) in September 2005, the bourse announced Tuesday that it would be known as Nasdaq Dubai from Nov 20 after Nasdaq OMX, which runs the Nasdaq stock exchange in New York, decided to list its shares here.

The Nasdaq OMX decision comes after it bought a one-third stake in DIFX in February. The remaining stock is owned by Bourse Dubai.

The exchange is located in the Dubai International Financial Centre, the onshore financial hub here designed to bridge the time gap between western Europe and East Asia.

Nasdaq Dubai’s region will include the UAE and the rest of the Gulf Cooperation Council (GCC), the wider Middle East and North Africa, Turkey and the Indian subcontinent.

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