A decline of 50% in the average of Saudi funds transactions
After 35 days of its launch in the secondary market
Inclusion of first index fund in the local market by the end of last March under the sponsorship of Capital Market Authority in order to promote institutional investment, in photo appears Dr. Abdulrahman Al-Tuwaijri, Capital Market Chairman. «Al-Eqtissadiyah»
A decline in the average trading of index funds ETFs in Saudi Arabia last week to the half at 80 transactions per day, with a total average of about 1.5 million riyals, an average of 150 to 200 transactions per day during the last month and an average rate of at least SR 2.5 million for a total value.
According to statements of the traded index funds on "Tadawul", which is so far only includes Falcom Fund ''f30'', Trading has seen a major decline on the first week of this month, a significant decline in the number of trading units performing on the stage of the secondary market, after the market had seen a high levels of having 5600 transactions on 28 March ,a total value of 271.327 million riyals, with a trading amount of 12.8 million riyals, followed by the last three days of the first week of the market, recording around 2800 deal at a daily average at 900 deals , a total value of about 30 million riyals.
As Abdullah Al-Suwailmy, Tadawul Chairman expected having a high demand from investors for index funds, given the advantages incurred by those funds.
According to an analysis published' by 'Reuters'', index funds are able to attract 200 million dollars (750 million riyals).
Dr. Fahad Al Mubarak, Tadawul's Board Director has confirmed after launching of index funds platform, that Saudi market is the most diversified in products and services in addition of being the largest region in terms of market value and trading value.
Traded index funds are characterized by transparency, by tracking the market indicators, it is easy to identify the investments of these funds in terms of content and rates of investment, funds makers are committed to broadcast information for full disclosure of their funds and tracking indicators.
These funds are subjected to the trading rules for firms with respect to periods and types of trading orders, in addition of not having a minimum rate to participate in these traded index funds.
As for units establishments, it’s the market makers process of buying units of traded index funds directly from the fund manager or licensed entity according to the instructions provided by the fund manager,.