Riyadh – Mubasher: The Saudi Stock Exchange (Tadawul) and index compiler MSCI Inc. have signed an agreement to launch a joint tradeable index in the fourth quarter of 2018, the Saudi bourse's CEO Khalid Al Hussan said.
The move will contribute to developing investment instruments, such as Exchange-Traded Funds (ETFs) and derivatives, he added, according to a statement.
“Saudi Arabia has undergone a remarkably rapid period of change in the past few years. This joint index is possible as a result of the Kingdom’s adoption of international standards and desire to create additional investment opportunities for domestic and international investors,” MSCI’s CEO and chairman Henry Fernandez commented.
In June, the global index compiler announced upgrading Tadawul to an emerging market (EM) status, from the standalone market in its annual review.
“The creation of the joint tradable index provides a strong foundation for the development of index futures and other exchange-traded products,” Al Hussan said.
He added that the launching of an index will lay the ground for “ETFs and other products that enable investors to broaden exposure and diversify and risk while enhancing the overall efficiency of the market.”