Abu Dhabi: The Abu Dhabi Securities Exchange’s (ADX) market liquidity shot up five-fold in 2021 amid an intense IPO boom. Driven by higher levels of domestic and international investment, ADX’s traded values increased 407 per cent from Dh145 billion in 2020 to Dh739 billion in 2021. Local investors accounted for 70 per cent of the traded value, while foreign institutional investors accounted for 30 per cent.
Net foreign investment reached Dh15 billion in 2021 - the highest recorded to date. The market value of shares owned by foreign investors in 2021 increased 100 per cent from Dh78 billion to Dh156 billion, while those held by UAE nationals reached Dh1.5 trillion compared to Dh685 billion in 2021, an increase of 117 per cent. The number of new investors on the exchange increased 701 per cent, from 2,362 in 2020 to 18,938 in 2021. Institutional investors was up 77 per cent to 708 in 2021 versus 400 in 2020.
Best performing indexes
The increased demand for Abu Dhabi stocks helped propel the exchange’s benchmark index 64 per cent higher, making it one of the world’s best-performing n 2021. The market cap of stocks listed on the ADX more than doubled to a record Dh1.6 trillion.
ADX One strategy
The exchange’s success is based on the ‘ADX One’ strategy, announced at the beginning of 2021. The strategy is made up of 22 initiatives to bolster corporate governance and meet the evolving needs of global issuers and investors. ADX introduced a derivatives market in the fourth quarter, which paved the way for an agreement with FTSE Russell to develop co-branded indices, including a tradable FTSE ADX Blue Chip Index that will be launched this year. The exchange also established a framework for listing ‘Special Purpose Acquisition Company’ (SPAC), which was approved by the Securities and Commodities Authority (SCA) in January.
As part of the ADX One strategy, the exchange forged several partnerships with global stock market operators in 2021, sealing agreements with Bahrain Bourse, Bursa Istanbul, and Astana International Exchange to unlock direct market opportunities. The exchange also moved to new premises in the landmark building on Abu Dhabi’s Corniche, unveiled a new brand, and introduced an investor relations and sustainability guide books.
Six debt instruments and an Exchange Traded Fund (ETF) were also added to the exchange in 2021, bringing the number of publicly listed companies to 69, debt instruments to 27, private companies to 13 and ETFs to two.
