The Saudi Stock Exchange (Tadawul) launched the Kingdom’s first exchange-traded derivatives market and clearing house on Sunday.
Using Nasdaq technology, the Saudi Futures 30 (SF30) Index Futures Contract is based on the MSCI Tadawul 30 (MT30), the first exchange-traded derivatives product. It provides investors with a benchmark of the largest and most liquid securities listed on Tadawul.
The launch of the derivatives market is one of the Financial Sector Development Program’s (FSDP) key initiatives under the Saudi Vision 2030.
It marks a significant step in introducing sophisticated market products and creating a trading environment attractive to local as well as international hedgers and traders, Tadawul explained.
All institutional, corporate and individual clients can trade in the market, it said.
To start trading in the derivatives market, a trading account must be opened through one of the members of the derivatives trading.
Meanwhile, Securities Clearing Center Company (Muqassa) has begun operating and affirmed it seeks to support the development of the Saudi financial market by improving the infrastructure for post-trading operations, contributing to reducing counterparty risks, enhancing operational efficiency, as well as supporting expansion by adding new products and services.
It pointed out that the market clearing will be activated in several stages, starting with MT30 index and followed by other markets in later stages.
The Kingdom’s benchmark Tadawul All Share Index (TASI) ended last week’s trading with a rise of 1.2 percent, up 92 points, and closed at 7934 points, compared to the previous week, which ended at 7843 points, to move on with the rise for the fifth week in a row.
Despite this increase, it failed to reach the 8,000- threshold points last week.
The value of total trading continued its weekly growth, recording an increase of 17 percent to amount to SAR45.1 billion ($12 billion), with an average of SAR9.02 billion per day, compared to about SAR38.67 billion in the previous week.
