Abu Dhabi Securities Exchange (ADX) to Launch Derivatives Market, Leveraging Nasdaq Technology
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,1 September2021:Today, Abu Dhabi Securities Exchange (ADX) announced that it has taken a key step towards launching a derivatives marketthis year by signing an agreement withNasdaq (Nasdaq: NDAQ) to deliver marketplace technology solutions, including matching, real-timeclearing and settlement technology.
ADXis rapidly expandingasset 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 exchangeplans to launch single stock futures and index futures in the fourth quarter of this yearbefore 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’sambitions.”
Saeed Hamad Al Dhaheri, Chief Executive Officer of ADX, added: “Our commercial relationship with Nasdaq dates toADX’s establishment in 2000, andover the last two decades, we have collaboratedon a range of initiatives to ensure investors benefit fromefficient market infrastructure technology. We are confident that the launch of aderivatives market will be another important milestone, empoweringinvestors on the exchangewho wish to implementsophisticated trading strategies. Our strategy is to ensure that investors and issuers derive significant benefits of a sophisticated marketplace byinvesting 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 August2021, ADX has 78companies listed on its main and Second Market.