On October 2017, ADX launched the TSS service, to be the first market in the region to provide such service, targeting the enhancement of investment liquidity, pricing control with their fair value and promoting the investment culture in line with global exchanges.
On this occasion, Mr. Rashed Al Blooshi, ADX Chief Executive, stated: “We are pleased to have one of the UAE’s top brokerage firms Integrated Securities added to the list of companies that provide the Technical Short Selling service at ADX. The launch of the TSS service is part of the Exchange’s strategy to increase market cap and products in order to attract and leverage a wider range of investors through diversification of investment tools, which in turn will help in raising the levels of liquidity to match global Exchanges.”
He added that ADX is continually developing the services it provides to investors and stakeholders alike, and continues its efforts to develop and launch strategic initiatives.
This is done in order to enhance the UAE’s investment structure and support its sustainable economic development, as part of ADX’s mission to contribute to Abu Dhabi Economic Vision 2030.
The TSS service that ADX offers comes with clear laws, rights and obligations governing transactions for brokers and investors alike. In line with ADX’s commitment towards transparency and disclosure, information regarding all transactions under the service are published on a daily basis via the ADX website. This helps give investors the confidence to invest their savings in the new service, knowing it sits within an advanced legal framework characterized by trust, fairness and open disclosure.
Brokerage companies will benefit from this service on behalf of their customers, the Market Maker, as well as any side that ADX finds fit for this service. It was empowered in a gradual application system”.
Al Blooshi continued, “The mechanism of TSS would diversify the investment and hedge mechanisms and raise the level of investment liquidity in order to attract new investors, especially that ADX is the first exchange to provide such service in the Gulf region, which confirms ADX’s interest to adopt integrated legislative regulations that ensure a safe investment environment.”
Following the recent acquisition of Integrated Securities by SHUAA Capital, Fawad Tariq-Khan, Chief Executive Officer of SHUAA Capital and now Board member at Integrated Securities, took the opportunity to comment on the occasion, “We are pleased to now be able to offer our client base the ability to take short positions on ADX listed stocks. With the introduction of short selling investors are now able to benefit from both upside and downside market moves. This is Integrated Securities’ first activity officially as a wholly owned subsidiary of SHUAA Capital, and the addition of this valuable offering to our brokerage suite is line with the overall Group’s commitment to establish the premier regional brokerage house operating out of the UAE.”
As part of ADX’s efforts to strengthen its legal, economic and legislative environment, the Exchange has implemented measures to regulate the short sell service including, trade suspensions for a 5% drop in the reference price of a given stock or if short sold securities reach 10% of the total capital issued.
The Exchange has also implemented a clear framework under which trades should take place, which specifies the obligation of the broker to disclose short dated trades, this comes in addition to the existing approval frameworks utilized by both the lending and borrowing agent.