Tadawul to name stocks for futures market soon: CEO

The Saudi stock exchange (Tadawul) will soon announce the companies that will be included into the burgeoning futures contracts market.

“We are in the process of selecting the companies that will be included into futures contracts market,” said Khalid Al Hussan, Chief Executive Officer of Tadawul, in a press conference today.

“This will take place before launching the joint tradeable index with the MSCI in the fourth quarter of 2018,” he added.

“Index-futures contracts are the first derivative product in local market, and will be followed by several products, including options.”

Tadawul and MSCI are developing criteria for the companies that will join the index, he added.

The global index provider MSCI announced it had signed an agreement with Tadawul to jointly launch a tradeable index later this year in a move that could spur the growth of derivatives and exchange-traded funds in Saudi Arabia.

"We have big plans for new (derivative) products… all incentives will be offered to ensure the success of the first product."

Tadawul said in a separate statement it would introduce exchange-traded derivatives in the first half of 2019.

The moves came after MSCI classified Saudi Arabia’s stock market as an emerging market in June.

Al Hussan asserted that the stock index futures will be followed with several other exchange-traded products. He also highlighted that the introduction of derivatives in 2019 was part of Saudi Arabia's Vision 2030 Financial Sector Development Program.