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Dubai Financial Market launches futures contracts

Dubai: The Dubai Financial Market (DFM) on Sunday introduced stock futures contracts as part of its new Futures trading platform amid unprecedented participation from the brokerage community.

The launch provides further impetus for DFM’s strategy to diversify product offerings and attract more investment. The DFM has developed a robust regulatory framework that is in line with international best practices, creating a favorable environment for active participation by different market participants. This strategic move enables investors to diversify and hedge their portfolios and access charges on futures contracts.

In celebration of the launch of this comprehensive stock futures platform, the DFM today hosted a bell-opening ceremony. To date, the platform has attracted 16 leading companies as Launch Partners, including trading members, market makers, as well as technology and data providers.

“The launch of this new platform is another milestone in DFM’s important journey. It emphasizes our commitment to diversifying investment opportunities for the large and diversified DFM base of local and international investors. As a result of this strategy, the DFM has become one of the leading regional markets offering several asset classes, including equities, bonds, Sukuk, ETFs and equities in the future. In addition, we plan to trade REITs and expand our platforms and attract new companies for listing in the coming period, ”says Essa Kazim, chair of DFM.

The platform currently contains futures contracts on some of the five most liquid shares listed on DFM, including: Emaar Properties, Dubai Islamic Bank (DIB), Emirates NBD (ENBD), Emaar Development and Emaar Malls, with a stay of 1, 2 and 3 months. The platform plans to expand the scope of its contracts, including index-based futures, over time.

Promising prospects

“We look forward to seeing different market participants take full advantage of this promising platform as we are confident in its growth prospects as investors face a growing demand for diversified financial instruments and various asset classes,” said Hassan Al Serkal. , CEO of DFM, said. “This claim has enabled us to launch the platform with unprecedented support and strong participation from brokerage firms that have shown interest in participating from day one as trading members and market-making Launch Partners,” he added.

Favorable framework

Hamed Ali, CEO of Nasdaq Dubai and Deputy CEO of DFM, said: ‘Dubai’s capital markets have created successful infrastructure and regulations with everything that supports the listing and trading of numerous asset classes. It also provides trade support mechanisms such as market making, liquidity supply, etc. We have developed a favorable trading rule for futures contracts in accordance with best practices and in collaboration with members and regulators to ensure that futures contracts are well positioned to reflect growth in international markets. ”

Clearance solutions

The DFM share futures contracts will be approved by the CCP of DFM’s subsidiary, Dubai Clear, using Nasdaq Dubai Operational and IT infrastructure. DCAM CEO Maryam Fekri said: “We welcome the launch of the platform as one of the first customers to use our world-class solutions since the official launch of Dubai Clear in April 2020. Dubai Clear is one of the first independent Central Independent Regions (CCP) for equity clearance, noting that CCP ensures the efficient use of collateral by Clearing members to optimize market liquidity in an efficient and secure manner in line with international best interests. practice. ”

Start partners

Senior executives of leading brokerage firms, technology providers and data providers welcomed the new platform as a key initiative to diversify investment opportunities and attract further investment. Due to the strong commitment of the brokerage community, the DFM has licensed ten brokerage firms, namely; BH Mubasher Financial Services, Al Daman Securities, EFG HERMES (UAE), Arqaam Securities, Shuaa Securities, Global for Shares & Bonds, Al Dar Shares and Bonds, Al Ramz Capital, SICO Financial Brokerage and Mena Corp Financial Services, as futures members, while both Al Ramz Capital and BH Mubasher Financial Services are licensed as stock futures market makers. In addition, SK Advisory FZ (Zag Trader), First Information Technology, Global Market Access Holding (DIFC) and Horizon Software joined hands with the DFM as technology and data providers.

The DFM intends to further expand the futures contract platform and attract more trading members, as well as licensing marketers to further promote trading and meet the growing demand from investors.

Source: Gulf News

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