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The Egyptian Exchange commenced its first ETF trading on Wednesday, January 14, 2015. The newly traded ETF tracks the main index, EGX 30 index, where its certificates are allowed to be traded as other securities, through brokerage firms.
The ETF nominal value on the first day of trading was LE 10 per certificate and it complied with all the applied trading mechanisms and rules except the trading suspension mechanism.
Dr. Mohammed Omran, EGX chairman stated that the commencement of trading on the first ETF in the Egyptian market is a new development and represents an increase in the market depth through providing new financial instrument other than stocks, bonds and mutual funds. He also stressed that this tool was an urgent demand by local and foreign investors and is expected to attract new investors as it represents a good hedging tool for all dealers that enables the investors to diversify the risks by investing in a basket of 30 stocks at once and at a lower trading cost.
Dr. Omran also explained “We had a clear commitment to EGX strategy (2013-2017) to launch ETFs during 2014, and we are glad that we were able to achieve this as it significantly reflects that institutional management has become the main culture at EGX."
Moreover, EGX Chairman stated "I see that the Egyptian market is progressing and moving confidently with a clear strategy to achieve further development and efficiency in accordance with the set objectives”. In addition, Dr. Omran also stated that the ETF launching also witnessed the commencement of a new mechanism, the market maker, which would contribute greatly to increasing market liquidity levels.
For more information regarding the newly listed ETF, kindly refer to EGX website www.egx.com.eg
