ADX Sees Stupendous Growth of Values and Volumes of ETFs Till May This Year

The Abu Dhabi Securities Exchange (ADX), one of the fastest growing bourses in the world, has recorded an increase in the values ​​and volumes of trading in Exchange Traded Funds (ETFs) during the first five months of this year, making it the most active and liquid fund market, compared with other stock markets in the Middle East and North Africa (MENA) region.

The value of the funds traded on ADX increased by 974% to reach $740 million between January and May this year when compared with $69.54 million during the same period in 2022.

This remarkable growth further consolidates the position of ADX as a preferred destination and a major regional centre for ETFs besides listing such investment funds from global investors. The market continues its efforts to expand investment products, enhance its efficiency and drive its sustainable growth.

The volume of shares of the index funds traded on the ADX increased by 705% to reach 411.4 million units by the end of the May this year, compared with about 51.1 million units during the first five months of 2022.

Likewise, the volume of transactions on index funds increased by 624%, jumping from 2,087 deals at between January and May in 2022, to 15,105 deals for the same period this year.

The performance of the ETFs on ADX is attributed to the advanced infrastructure of the bourse and its strategy to continue innovation, enhance, and expand investment options and solutions in it, especially after the market recently launched the new commercial identity of the traded investment fund market.

The ETF platform, under the new commercial identity, will continue to provide investors with enhanced liquidity and enhance the Abu Dhabi Securities Exchange’s ability to innovate and provide world-class investment trading strategies, covering a variety of investment tools.

Chimera Capital, an Abu-Dhabi-based investment management firm, announced the launch of the Chimera S&P China HK Shariah ETF on May 25 this year.

ADX has signed two Memorandum of Understanding (MoUs), one each with Astana International Exchange in Kazakhstan and Luxembourg Stock Exchange respectively on June 7 and 8 this year to establish a framework of cooperation between the two institutions to facilitate the dual listing of a broad range of financial instruments.

As many as 74 companies are listed on the ADX and their market capitalisation is around $740 billion at the end of May this year.

Initial Public Offerings

In its Global IPO Trends report in March, global consultancy firm Ernst & Young (EY) said that Abu Dhabi accounted for 14% of all listings worldwide in the first three months of this year indicating the strength of its capital markets notwithstanding global headwinds facing the global IPO market.

ADX, the Arab world’s second-largest stock market after Saudi Arabia’s Tadawul, has witnessed a series of IPOs and they included Borouge, the joint venture between ADNOC and Austrian chemicals producer Borealis, Abu Dhabi Ports Group, the operator of industrial cities and free zones in the Emirate.

The ADX plans to list as many as 11 companies in 2023.

In an interview with Bloomberg TV early this year, Mohamed Ali Al Shorafa, chairman of the Abu Dhabi Department of Economic Development (ADDED) said that 2023 is going to be an amazing pipeline with over 11 companies (are) being either advised or in final stages for application approval for the listing on the ADX.