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Mon 13 Dec 2010 01:29 PM

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Saudi online trading platform plans GCC expansion

Cross-border transactions increasing despite tepid bourse performances – Derayah CEO

Saudi online trading platform plans GCC expansion
ONLINE TRADING: Saudi Arabias Derayah plans to offer its online trading platform to other GCC countries by the end of 2011 (Getty Images - for illustrative purposes only)

Saudi ‘investment supermarket’ Derayah is planning to offer its online trading platform to other countries in the GCC by the end of next year, the firm’s CEO has said.

“Given the fact that our platform is fundamentally electronic, we don’t really have as much of a service model as the rest of the firms have - in terms of branches and so on - and that model is easily replicable across the region,” Derayah CEO Mohammed El-Kuwaiz told Arabian Business.

“Our plan is to start expanding across the region as soon as we complete the roll-out of all the markets we want to launch here.”

Derayah’s offering to individual investors consists of a mutual funds product and a unified online equity trading platform – the Middle East’s first – which was launched in October.

The CEO said that the initial response to the trading platform had been encouraging, despite the recent stagnant performances of Gulf indices.

“The interesting observation is while volumes have declined across GCC markets in terms of volumes, cross-border transactions have increased tremendously,” he added.

“So while Saudi investors have traditionally traded in the Saudi market, and UAE investors likewise – you are now increasingly finding Saudi investors trading in the UAE and Qatar and vice versa. This will probably grow even more as the economies and regional capital markets integrate.”

While the platform is currently only available to Saudi investors, El-Kuweiz said that the first non-Saudi customers would be able to trade on the platform by the end of 2011, and that the company was in talks with local regulators to achieve that goal.

Derayah’s customers can currently trade on the Saudi, Dubai and Abu Dhabi bourses, although the CEO also said the ability to trade in the Qatar and US markets would be enabled by the end of this year.

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