Dubai: Dubai International Financial Exchange (DIFX) on Tuesday launched DIFX TraX, the first ever structured products trading platform in the region.
Structured products are financial instruments issued by institutions and currently they have an annual global turnover of more than $750 billion. They are designed to meet specific investment objectives such as capital protection, yield optimisation and leverage.
Deutsche Bank, Merrill Lynch and Morgan Stanley listed 14 structured products on DIFX that give exposure to shares listed on the Dubai Financial Market (DFM) and the Abu Dhabi Securities Market (ADSM), as well as securities linked to commodities such as oil and sugar. With the existing nine structured products, DIFX currently has 23 such products listed on it.
"DIFX TraX fills a glaring gap in the capital markets. DIFX aims to build TraX into a major platform, serving its region with a wide variety of structured products," said Hamed Ali, executive officer of DIFX.
DIFX TraX includes products based on specially created indices relating to DFM, ADSM and other GCC bourses. "We plan to add products as the platform grows. We can add any number of instruments depending on demand," said Armen V. Papazian, managing director, innovation and development of DIFX.
Other DIFX TraX products are based on US, European and East Asian indices. Others are based on commodities such as oil, soy, corn, wheat, sugar and cotton.
Initially, EFG-Hermes, Mashreq and Mubasher will provide brokerage services in structured products.