The Abu Dhabi Securities Exchange (ADX) has launched a new trading system that will allow faster and more efficient transactions on the capital's stock market.
Rashed Al Baloushi, the ADX chief executive, said the new platform, called X-Stream, “takes us to a completely new operational level and prepares the way for the next stage of our development”.
The system went live yesterday, having been tested and trialled over the past 18 months. “The launch of X-Stream is the culmination of a vast amount of work done by both ADX and our partners at Nasdaq OMX to achieve a faultless transition, and it is a proud moment for us,” Mr Al Baloushi said.
Nasdaq OMX is the New York-based group that runs 26 stock markets around the world. It is a partner in the Nasdaq Dubai international exchange, which also uses a version of the X-Stream platform, as does the Dubai Financial Market. The American company has provided technological support for ADX since it was launched 14 years ago.
“It is faster and more robust,” said Mr Al Baloushi.
According to the bourse: “The upgraded platform will handle not only the trading of equities, but it will also support market-making activity and transactions of fixed income and exchange-traded fund instruments, while providing the scalability to allow additional instruments to be added at a later date. The new platform will allow ADX to handle an unlimited number of indices.”
The new system will not allow flash trading, the high-frequency computer-driven transactions that have recently come under attack as a form of market manipulation, which is not allowed in the UAE, Mr Al Baloushi said.
Some market professionals believe the introduction of X-Stream by ADX might help to smooth the way for a consolidation of the UAE’s exchanges, which has been under consideration for some time.
“It removes another obstacle to merging the exchanges,” said one analyst who did not want to be named.
Mr Baloushi declined to comment on the prospect for consolidation.
ADX said: “X-Stream trading provides a proven, functionally rich, multi-asset trading platform that complies with international standards and policies. The new platform will improve ADX’s trading performance and transparency, and ensure low latency in pre- and post-trade, or at-trade, risk management checks. It will also allow faster back-office reconciliation of transactions.”
Mr Al Baloushi, who has been with the exchange since it was launched, added: “Back in 2000 it was all very low-tech with lots of paper transactions. Over the years market professionals have been required to give that up and move to a more advanced system. Now we have a new generation of electronic traders who are shifting to smart trades.”
ADX recently completed an investors’ roadshow in New York, with ten of its biggest companies meeting potential investing institutions.
“We are getting the feedback that new investors are coming into the market for Abu Dhabi stocks. We are planning a similar roadshow to London,” said Mr Al Baloushi.
There has been speculation that ADX would move its headquarters to the new financial free zone being set up on Al Maryah Island. Mr Baloushi said he had nothing to say on that possibility.
fkane@thenational.ae
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