Saudi Arabia’s stock exchange, the Tadawul, said it plans to launch single stock futures on July 4, “which will enable local and international investors to hedge and manage portfolio risks more effectively,” Reuters reports.
Tadawul said in a statement on Sunday that the underlying stocks for single stock futures have been selected from the largest and most liquid publicly listed companies.
The move is part of a number of reforms to attract overseas share buyers and issuers as part of efforts to bring in foreign capital and diversify the economy.
The precarious position of the global economy with inflation rising in part as a result of the Russian-led war in Ukraine has hit Saudi equities in recent weeks, briefly erasing the year’s gains last week before bouncing back as bargain hunters swooped in. Earlier this year, in March, the Saudi Tadawul Group, the bourse’s owner and operator, posted a 17.4% rise in full-year net profit in 2021, fueled by the strong performance of the Saudi capital market last year. The group was listed on December 8th, seeking to raise $1 billion, and soared after its debut.
In recent months, companies listing on the Tadawul or its parallel market, Nomu, have found significant appetite from investors, with most IPOs being oversubscribed.
