Abu Dhabi Securities Exchange (ADX) to Launch Derivatives Market, Leveraging Nasdaq Technology

Rhea-AI Summary

Nasdaq and ADX have partnered to enhance the Abu Dhabi Securities Exchange's offerings by launching a derivatives market this year. The agreement includes advanced market technology solutions for matching, real-time clearing, and settlement. The ADX General Index has risen to 7700 points, gaining 52% year-to-date, highlighting increased investor participation. The introduction of single stock and index futures aims to diversify investment options and provide hedging tools. Additionally, the market will implement central counterparty clearing to boost confidence and stability.

Positive

• Successful partnership between Nasdaq and ADX for advanced market technology.
• ADX General Index has gained 52% year-to-date, indicating strong market performance.
• Launch of single stock and index futures planned for Q4 2021 to enhance investment opportunities.
• Introduction of central counterparty clearing to improve market stability.

Negative

• None.

Nasdaq and ADX sign new market technology agreement

Single stock and index futures will provide investors with hedging tools

Initiative will be supported by addition of CCP clearing capability for Derivatives Contracts

NEW YORK and ABU DHABI, United Arab Emirates, Sept. 01, 2021 (GLOBE NEWSWIRE) -- Today, Abu Dhabi Securities Exchange (ADX) announced that it has taken a key step towards launching a derivatives market this year by signing an agreement with Nasdaq (Nasdaq: NDAQ) to deliver marketplace technology solutions, including matching, real-time clearing and settlement technology.

ADX is rapidly expanding asset classes and developing new offerings for both regional and international investors. The ADX General Index (ADI) has recently reached 7700 points for the first time, supported by a series of listings and increased participation by international investors. In addition, the index has gained 52% year to date, making it one of the best performing equity indexes in the world.

The exchange plans to launch single stock futures and index futures in the fourth quarter of this year before expanding to a wider range of derivative products. The initiative will further diversify investment avenues and provide investors with hedging tools for effective risk management.

The derivatives market will be accompanied by introducing central counterparty clearing (CCP) to promote clearing efficiency, stability and confidence in the market.

H.E. Mohammed Ali Al Shorafa Al Hammadi, Chairman of ADX, commented: “ADX is on a journey to significantly enhance liquidity and expand market capitalization through our ‘ADX One’ strategy, which provides a clear road map for further development of a vibrant exchange. By deepening our capital markets and increasing the range of innovative products and services, we are supporting the UAE’s strategy for economic diversification, providing growth companies with favorable access to global capital and allowing investors to participate in the UAE’s ambitions.”

Saeed Hamad Al Dhaheri, Chief Executive Officer of ADX, added: “Our commercial relationship with Nasdaq dates to ADX’s establishment in 2000, and over the last two decades, we have collaborated on a range of initiatives to ensure investors benefit from efficient market infrastructure technology. We are confident that the launch of a derivatives market will be another important milestone, empowering investors on the exchange who wish to implement sophisticated trading strategies. Our strategy is to ensure that investors and issuers derive significant benefits of a sophisticated marketplace by investing further in technology, broadening our offering, and attracting a wider range of institutional investors.”

Lars Ottersgård, Executive Vice President and Head of Nasdaq Market Technology, said: “ADX continues to be an industry leader in innovating and evolving the Middle East’s capital market ecosystem. By leveraging Nasdaq’s robust and flexible technology solutions, ADX can further evolve its endeavors to expand into a leading derivatives marketplace and one of the largest multi-asset marketplaces in the Middle East. We look forward to progressing our technology partnership and supporting ADX in their growth journey.”

Nasdaq’s end-to-end market technology powers more than 2,300 companies in 50 countries, spanning the world’s financial industry, including capital markets infrastructure operators, market participants, banks, and regulators.

The ADX One strategy, launched at the start of 2021, aims to bring a broader offering of products and services to market and invest in state-of-the-art infrastructure in partnership with global market leaders. As of August 2021, ADX has 78 companies listed on its main and Second Market.

About Nasdaq

Nasdaq (Nasdaq: NDAQ) is a global technology company serving the capital markets and other industries. Our diverse offering of data, analytics, software and services enables clients to optimize and execute their business vision with confidence. To learn more about the company, technology solutions and career opportunities, visit us on LinkedIn, on Twitter @Nasdaq, or at www.nasdaq.com.

About Abu Dhabi Securities Exchange

Abu Dhabi Securities Exchange (ADX) was established on November 15 of the year 2000 by Local Law No. (3) Of 2000, the provisions of which vest the market with a legal entity of autonomous status, independent finance and management. The Law also provides ADX with the necessary supervisory and executive powers to exercise its functions. On 17th March 2020, ADX was converted from a “Public Entity” to a “Public Joint Stock Company PJSC” pursuant to law No. (8) of 2020. ADX is part of ADQ, one of the region’s largest holding companies with a broad portfolio of major enterprises spanning key sectors of Abu Dhabi’s diversified economy.

ADX is a market for trading securities; including shares issued by public joint stock companies, bonds issued by governments or corporations, exchange traded funds, and any other financial instruments approved by the UAE Securities and Commodities Authority (SCA). ADX is the second largest market in the Arab region and its strategy of providing stable financial performance with diversified sources of incomes is aligned with the guiding principles of the UAE “Towards the next 50” agenda. The national plan charts out the UAE’s strategic development scheme which aims to build a sustainable, diversified and high-value added economy that positively contributes to transition to a new global sustainable development paradigm.

Media Contacts

Nasdaq

Ryan Wells
Mobile: +1 646 648 3887
ryan.wells@nasdaq.com

Yan-yan Tong
Mobile: +1 240 721 80 66
yan-yan.tong@nasdaq.com  

ADX

Abdulrahman Saleh ALKhateeb
Senior Manager of Corporate Communication & Digital Marketing, ADX
Mobile: +971 (50) 668 9733
Email: ALKhateebA@adx.ae

Tasha Young
Director, Brunswick Group
Mobile: +971 (56) 174 8207
Email: tyoung@brunswickgroup.com

NDAQG

FAQ

What is the partnership between Nasdaq and ADX about?

Nasdaq and ADX signed an agreement to implement advanced market technology solutions to launch a derivatives market.

When will ADX launch the derivatives market?

The ADX plans to launch single stock and index futures in the fourth quarter of 2021.

What has been the performance of the ADX General Index?

The ADX General Index has reached 7700 points and gained 52% year-to-date.

How will the new derivatives market benefit investors?

The derivatives market will provide investors with more diverse investment avenues and hedging tools for risk management.

What technology will Nasdaq provide to ADX?

Nasdaq will deliver matching, real-time clearing, and settlement technology as part of the partnership.