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Tuesday, 2 May 2017

Short Selling Makes Quiet Start in Middle East After Saudi Debut - Bloomberg

Short Selling Makes Quiet Start in Middle East After Saudi Debut - Bloomberg:

"Saudi Arabia, the Middle East’s largest share market, became the first in the region to introduce short selling last month. Investors have yet to test the waters.

Allowing the sale of borrowed securities is among steps the country is taking to make its market more attractive as it closes in on an upgrade to emerging-market status and readies a record initial public offering for state oil company Saudi Aramco. Still, since authorizing short selling on April 23, regulators overseeing the $438 billion Saudi stock market are still to record the first transaction.

Given the dominance of retail investors across the region, the cautious approach to the newly allowed strategy could be understandable. Few markets provide trading in futures or options contracts on stocks, for example. In Dubai, where futures contracts on some shares have been offered since September, volumes have been light. The Emirate, Qatar and Kuwait said earlier this year they aim to allow short selling, but details have been scarce."



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