Egypt Stock Exchange Grants First ETF Licence

April 30, 2014

The Egyptian stock exchange has issued its first licence to Beltone Financial to list the first exchange traded fund (ETF) in the region, according to a note on the exchange’s website.

The ETF is expected to track companies in Egypt’s EGX30 index.

Mohammed Omran, chairman of EGX, explained in a note that working with ETFs offers investors a variety of financial tools to access markets.

He said that the new ETF would be a good hedging tool for all dealers (either individual or institutional) because ETFs are traded on a daily basis like regular shares.

The Egyptian Exchange (EGX) started applying to regulators about entering the ETF market, with both ETFs and market maker activity, at the beginning of this month.

Alaa Sabaa, chairman of Beltone Financial, said: “Signing the agreement using EGX30 companies to create the first ETF in Egypt adds value to the market depth in Egypt, as it will allow investors to follow its daily performance.”

He added that the cost of managing an ETF is less than other funds.

According to a report from Reuters the ETF is expected to start trading within the next six weeks.

 

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