Sunday 29, October 2017 by Nabilah Annuar

FTSE Russell launches Saudi Arabia Inclusion Index Series

Stand-alone Saudi Arabia indexes launched.

FTSE Russell has launched the FTSE Saudi Arabia Inclusion Index Series. The comprehensive 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 Arabia capital market to Qualified Foreign Investors (QFI), which was initiated in 2015 and further enhanced in 2016. 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 (FTSE GEIS).

Commenting on the new index, Mark Makepeace, CEO of FTSE Russell said, “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. 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. We look forward to working with Tadawul to further develop the index series and create innovative index products for this market”. 

In September 2017, FTSE Russell announced its annual country classification, which confirmed that Saudi Arabia remains on the FTSE Watch List for possible inclusion as a Secondary Emerging market within FTSE GEIS. Saudi Arabia has taken a number of positive steps to increase the openness and effectiveness of its markets and, as a result of these reforms, it is anticipated that Saudi Arabia will meet the requirements for inclusion as a Secondary Emerging market from early 2018 following the implementation of further enhancements to the Independent Custody Model (ICM).

Sharing similar sentiments, Khalid Al-Hussan, CEO, Tadawul added, “We are firmly committed to the growth and development of the financial markets in Saudi Arabia and have undertaken wide-ranging reforms to enhance market access, transparency, governance and efficiency. We are pleased that FTSE Russell has launched this new dedicated Saudi Arabia index series alongside the global and regional Saudi inclusion indexes, which we believe represents further progress in our efforts to create an attractive investment climate for international and domestic investors.”

To support growing demand, FTSE Russell offers market participants the FTSE Saudi Arabia Inclusion Index Series, a global index series that combines the constituents of the stand-alone FTSE Saudi Arabia Index with various regional and global FTSE indexes.