ADS Securities, the fast-growing Abu Dhabi financial firm, aims to be among the first institutions operating in the new financial free zone being set up in the capital.
Mahmood Ebraheem Al Mahmood, the ADS chairman and chief executive, told The National that the free zone "is a game-changer for us. We will be one of the first to move in, as soon as it's ready, hopefully by the end of this year."
ADS is the first of the capital's financial institutions to signal its intention to move to the new centre on Al Maryah Island since the free zone was decreed by the Abu Dhabi Government in February.
Several other financial firms, including National Bank of Abu Dhabi and Al Hilal Bank, had already announced they would have a presence on Al Maryah before the free zone was decreed. "I hope all local banks will think about a presence there.
"We are all just waiting and anticipating the arrival of a legal structure for the free zone," Mr Al Mahmood said.
ADS was involved in discussions with the Abu Dhabi authorities before the free zone was announced, and is believed to have argued the case for an increase in transactional capacity in the capital.
"All the research shows that levels of global trading fall off for a few hours roughly equivalent to 7-11am Abu Dhabi time," Mr Al Mahmood said. "There is no price-setting and market making, and little liquidity during those hours, between the closing of Asian markets and the opening of European ones.
"It's the same institutions trading round the world, and of course there is computer software to allow trading in these 'dark hours', but it needs humans to operate it to maximum efficiency. Whoever has the daylight has the market," he added.
He said that Dubai "had built its financial centre [the Dubai International Financial Centre] to a certain level, and provided what it has provided. But 2004 was a very different environment when DIFC was created. Finance was easy then, we now need a more holistic approach to securities trading."
He added: "We now need to focus on the full range of 'sell-side' services, rather than the 'buy-side' focus of Dubai."
The "sell-side" versus "buy-side" distinction is often used by financial experts to describe different securities trading strategies. The former is typified by active promotion of opportunities to investors, the latter typically involves analysis and identification of buying opportunities.
"Dubai stopped where they stopped. Since 2008 there are more sophisticated global investors who want a more sophisticated market," Mr Al Mahmood said.
He said there was no need to "formalise" the relationship between the new Abu Dhabi free zone and DIFC to guarantee cooperation between the two centres. "Lots of other markets round the world co-exist and are complementary to each other, look at New York and Chicago, London and Zurich, Tokyo and Osaka."
"When we [ADS] started three years ago, a lot of people were surprised. Abu Dhabi had usually been a buyer of investment services, not a seller.
"Clients now want a market and a legal environment that will allow them to take a quantum step in global trading," he said.
Mr Al Mahmood is regarded as one of the rising stars of Abu Dhabi's indigenous investment scene. He began his career at the Abu Dhabi Investment Authority as a trader but went on to develop algorithmic trading techniques.
He has served as a director of the Securities and Commodities Authority and is currently on the board of Mubadala Development, the Abu Dhabi government-owned investment vehicle.
He launched ADS three years ago as a trading platform in foreign exchange, bullion and commodities instruments, and has since added fixed income interest trading capability.
Seed capital of $500 million was provided by wealthy private investors. Initial short-term targets were set at $1 billion of trading per day, but now they have hit $6bn. "The target now is in only one direction - north," Mr Al Mahmood said.
He dampened speculation that he has been earmarked for an executive role within the new authority that will oversee the Abu Dhabi financial free zone. "Personally my ambitions are with ADS but if my expertise is ever needed of course I'd be available."
