Russell Investments indexes signed an agreement with the Saudi Stock Exchange, Tadawul, that would give it access to prices and other data that would enable it to create equity indexes that track performance of companies in the Middle East. Terms weren’t disclosed.
The indexes could eventually be the basis for investment products, including exchange-traded funds, the company said in a press release. Russell’s move underscores renewed investor interest in the region after that interest all but dried up completely in the aftermath of the 2008 global credit crisis.
Tadawul represents half the equity market capitalization of all the Gulf Cooperation Council (GCC) stock exchanges, which include the markets of Saudi Arabia, the United Arab Emirates, Bahrain, Oman, Qatar and Kuwait. The region is of major economic importance globally mostly because of its huge oil deposits.
Two ETFs are currrently listed on Tadawul, both sponsored by Falcom Financial Services: the Falcom Saudi Equity ETF, a long-term capital appreciation and growth play focused on Saudi equities, as well as the Falcom Saudi Petrochemical ETF. Both were launched earlier this year, according to Tadawul’s website.