Dubai is the capital of the United Arab Emirates (UAE), a country that stretches over some 6,500 square miles with 10 different climatic zones. It is a country that has always accommodated large populations from various backgrounds and cultures. This is evident in its cities and towns where you will find people from all walks of life living alongside each other. The financial sector and capital markets in Dubai are no different with it offering opportunities for businesses and individuals alike.
There are several reasons why this is the case. Furthermore, it has been instrumental in helping set standards for companies operating there and abroad.
A Quick Look at Dubai Capital Market
Dubai is the financial hub of the Middle East, hosting a wide range of international financial institutions and the largest stock exchange in the region. The Dubai Financial Market (DFM) was established in 1996. The DFM is a stock exchange and an over-the-counter (OTC) trading venue for foreign and local shares, as well as commodities and derivatives. A futures and options market was launched in 2012. The DFM is the largest bourse in the Middle East, Africa, and South Asia. Dubai has become the most important financial hub of the Middle East.
The rise of Dubai’s financial sector is attributed to the city’s strategic location and the fact that it’s a gate to the East. Dubai’s strategic location makes it a gateway to the East, a gateway to the West, and a gateway to the South, drawing investors from all over the globe. With its strategic location and diversified economy, Dubai has gained significant importance in the global financial market
Why Do You Need to Deal in the Dubai Stock Exchange?
A key benefit of trading stocks in the Dubai Capital Market is the fact that you can access the international market, including trading shares of companies based outside of the UAE. This can be particularly useful for businesses that are based outside of the UAE, but have a DMC listing which allows them to trade shares on the Dubai Stock Exchange. Another benefit of trading in the DFM is the fact that you can invest in stocks that are listed on the exchange, which means you can diversify your investment portfolio by investing in companies that are not based in the UAE.
The DFM is a fully-fledged stock exchange, and along with the Dubai Financial Market (DFM) itself there are eight separate sub-markets established to cater for different sectors of the market. These include the Emirates Securities Exchange (ESX), which trades indices and international financial instruments, the Inter-Exchange Trading (IET) market, which trades derivatives such as options, and the Auto Trading Market, which trades shares of auto companies.
The History of the Dubai Financial Sector and Its Role in Today’s Economy
When the United Arab Emirates was established in the late 1960s, the country’s founders recognized the importance of the financial sector. As well as serving as a hub for commerce, the financial sector would be a key asset in supporting the UAE’s economic growth. The first steps towards establishing a regulated financial sector were taken in 1965 with the establishment of the Dubai Currency Exchange and the Dubai Gold Exchange.
The Dubai Gold Exchange was established in 1968 and is the oldest exchange in the region. The growth of the financial sector in the UAE has been significant, with the value of financial sector assets having grown from AED 357 billion by 1995 to AED 3,128 billion by 2008. This growth has been helped by the opening of the stock exchange in 1996, which has proved to be a catalyst for further growth in the financial sector.
Key facts about the DFM – Barsam Said Ahmed
The DFM’s vision is for the financial sector to play a catalytic role in moving the UAE forward positively and progressively. As such, the DFM’s core strategy is to provide a host of financial products and services that are conducive to growth and development. The DFM is committed to providing a smooth, efficient, and secure trading environment for market participants.
In addition to ensuring that traders have access to a diverse range of financial products and services, the DFM also plays an important role in the region’s economy by providing an important channel for foreign direct investment (FDI). It’s important to note that since the DFM is part of the Dubai Government, it is fully regulated and supervised by the Central Bank of the UAE.
Conclusion
The capital markets in Dubai are the largest in the Middle East and Africa, with an average daily turnover of US$12 billion. As one of the world’s fastest-growing financial hubs, the city continues to attract international investors and is also a gateway to the region. The city’s thriving economy also makes it an attractive location for businesses. You can visit the DFM website for more information about registering as a trader or for additional information about the market.
