- Trading volumes of Saudi equities have unexpectedly surged this year, providing a significant boost to the stock exchange operator Saudi Tadawul Group Holding Co. The average daily value traded on the Tadawul has soared to 8.9 billion riyals ($2.4 billion), marking a remarkable 68% increase from the previous year's total. Citigroup Inc. analyst Rahul Bajaj hailed this development as a "major positive," attributing the surge to the full launch of high-frequency trading and increased investor participation in the exchange.
- Bajaj noted that the substantial jump in trading volumes could be primarily attributed to the introduction of high-frequency trading, along with heightened involvement from investors. He anticipates this trend of higher volumes to persist throughout 2024, with a gradual further increase expected in the following years, extending to 2025 and 2026.
Why it matters
Saudi Arabia has been actively expanding its capital markets, aiming to attract more foreign investors by encouraging more companies to go public and introducing various financial products such as options and futures. The surge in trading volumes of Saudi equities holds substantial implications for both domestic and international investors.
