- The Nasdaq Financial Framework (NFF), including the Packaged CCP, Market Surveillance and Nasdaq Matching Engine, creates a world-class combined ecosystem for multi-asset trading, surveillance and clearing activities
- H.E. Essa Kazim: “Significant milestone that further strengthens Dubai’s leading position as a capital markets’ hub, as the UAE preparers for the next 50 years of its momentous journey”
- Hassan Al Serkal: “The new trading engine empowers the DFM with a fast, high throughput and efficient protocol that accommodates more than 80 thousand trades per session”
- Maryam Fekri: “Going-live with the first Nasdaq Packaged CCP clearing system for cash equities globally equips us to launch Dubai Clear, the UAE's first independent equities Central Counter Party Company”
- Paul McKeown: “Nasdaq’s clearing and matching technology delivers the highest levels of reliability, greater flexibility and effectiveness, as well as the compatibility and openness between applications and external systems"
The Dubai Financial Market (DFM) today announced it has successfully implemented the largest technology upgrade through its entire history by migrating to the Nasdaq Financial Framework (NFF), as of the trading session of Sunday, 15 March 2020.
Developed by Nasdaq, the leading market technology provider globally, this cutting-edge ecosystem for trading, surveillance, clearing and market data dissemination will further strengthen DFM’s leading position as a main driver of capital markets’ development in the UAE and the region.
The system is designed to provide exchanges with the necessary resilience to run multi-asset platforms, hence it creates a solid foundation to realize DFM’s strategic objectives on the long term by accommodating numerous trading platforms for stocks, derivatives, debt instruments of bonds and Sukuk, investment funds, Exchange Traded Funds (ETFs) and others, noting that the DFM is planning to launch new trading platforms during the coming period including; the first of its kind platform for trading of securities of free zone companies and the REITs platform.
Moreover, the system provides the DFM with superior infrastructure for the implementation of margins for mitigation of trade settlement risks by its new clearing company Dubai Clear, expected to be officially launched soon as part of a widespread revamp of the post-trade services.
Commenting on this development, His Excellency Essa Kazim, Chairman of the DFM said: “As the UAE prepares this year for the next 50 years of its momentous journey, we are pleased to go-live with this upgrade, which represents a steppingstone in DFM’s continued efforts to reinforce its leadership in employing the most advanced capital markets’ technologies. This has always been one of the main business considerations since DFM’s inception, noting that the exchange started as fully-electronic from day one. We are committed to cater to the expectations of our large and diversified investor base of local and international investors, providing them with world-class capital markets’ services. The achievement of our technical infrastructure renovation in conjunction with DFM’s 20th anniversary represents the dawn of a new era of sustainable growth that will further strengthen Dubai’s leading position as a dynamic capital markets’ hub. We would like to extend our sincere thanks to Nasdaq, the market technology partner of DFM since 2000, for their efforts in our ongoing development plans.”
Hassan Al Serkal, Chief Operating Officer (COO) and Head of Operations Division of DFM said: “The DFM is constantly exploring ways to enhance systems’ effectiveness and provide market participants with supreme services based on state of the art technologies and innovations. As trading system is the heart of any exchange, seamless migration to the new platform has been a key priority for us. As the first regional exchange to go-live with the Nasdaq Matching Engine, the DFM is now empowered with a fast and efficient protocol developed to minimize latency and to maximize order management throughput accommodating more than 80 thousand trades per session. With this upgrade, the DFM will be first exchange in the region to have Buyin auction session in trading platform available to all investors, increasing transparency and supporting post trade activities. It also provides us with an ultra-efficient mechanism for the dissemination of market data.”
Maryam Fekri, Chief Executive Officer of the Dubai Central Clearing & Depository LLC (DCCD) said: “As the first Central Counter party (CCP) in the world to go-live with the Nasdaq Packaged CCP (PCCP) for equities, which is currently used only for derivatives clearing, we are well equipped to launch Dubai Clear, the UAE's first independent equities CCP company. Nasdaq’s clearing technology allows Dubai Clear to calculate collateral requirements (margins) on a segregated client level basis in line with international best practices with a capability to support multi-currency and multi-exchange clearing.”
Nasdaq’s clearing technology delivers further benefits by introducing a risk management model that monitors operational cash limits based on margining versus collaterals, thereby providing participants with additional trading capacity as limits are only consumed for matched trades.
Paul McKeown, Senior Vice President, Market Technology, Nasdaq said: “Nasdaq is pleased to partner with Borse Dubai Limited in overhauling its technological infrastructure, and providing an open system architecture that supports and enables their marketplace into the future. Nasdaq’s clearing and matching technology delivers the highest levels of reliability, greater flexibility and effectiveness, as well as the compatibility and openness between applications and external systems. We look forward to continuing our support of Borse Dubai Limited as they evolve and expand their business.”
It is noteworthy that the DFM has successfully organized more than 10 market wide Mock sessions as well as several orientation workshops in collaboration with brokerage firms and service providers to ensure seamless transformation into the new system.
