FTSE Russell launches Saudi Arabia inclusion index series

FTSE Russell has launched the FTSE Saudi Arabia Inclusion Index Series, the index provider said in a statement on Sunday.

The series of global, regional and country-level indexes are designed to support domestic and international investors in response to regional growth and the opening of the Saudi capital market to Qualified Foreign Investors (QFI), which began in 2015 and was further enhanced last year.

“The indexes can also be used as a transitional tool in preparation for the potential inclusion of Saudi Arabia in the widely-followed FTSE Global Equity Index Series,” the statement said.

The index provider denied Saudi Arabia entry to its index of emerging market countries last month, noting that it expects the Kingdom to meet the requirements for inclusion as a Secondary Emerging market from early 2018.

“FTSE Russell has strong relationships in the Middle East and we are delighted to launch the new stand-alone country indexes for the Saudi Arabian market,” said Mark Makepeace, CEO of FTSE Russell.

“Alongside this, the Saudi Arabia inclusion indexes are a very positive step for the market and country as a whole and we will now begin work with institutional and market practitioners to prepare for the anticipated classification of Saudi Arabia as a Secondary Emerging market,” he added.

Tadawul CEO Khalid Al-Hussan said the bourse has undertaken a range of reforms to improve market access, transparency, governance and efficiency.

Some of the reforms introduced over the past couple of years include opening the markets to foreign investors, changing over to a T+2 settlement cycle, lowering assets under management (AUM) requirements for qualified foreign investors (QFI) and introducing shorting of trades.