Saudi Exchange announces intent to launch single stock futures contracts in July

The Saudi Exchange has announced its intention to launch single stock futures (SSFs) contracts next month.

From July 4, the new contracts will be available to trade, enabling local and international investors to hedge and manage portfolio risks more effectively and diversify their products.

Read: Saudi exchange to allow single-stock futures from next quarter

The contracts will mark the second derivatives product to be introduced in the Saudi Exchange.

SSFs contracts are standard futures contracts with an individual stock as its underlying asset. Ten underlying stocks were selected for contracts based on certain criteria to ensure market interest and liquidity. These include Al Rajhi Bank, Saudi Aramco, Saudi National Bank, Alinma Bank, SABIC, stc, Saudi Kayan, Saudi Electricity, Almarai and Maaden. SSFs contracts will be cleared and settled by Securities Clearing Center Company ‘Muqassa’.

Saudi Exchange Announces Its Intention to Launch Single Stock Futures (SSFs) on the 4 July 2022. To learn more visit the link

— Saudi Exchange | تداول السعودية (@tadawul) June 26, 2022

Mohammed Al Rumaih, CEO of Saudi Exchange, said: “We are excited to introduce the second derivatives product to the Saudi Exchange, as we continue to deliver on our commitment to providing a sophisticated and innovative range of products and services to local and international investors. The launch of the SSFs contracts further supports the advancement of the Saudi Capital Market by creating diversified offerings, complemented by hedging tools to manage risk and limit losses in adverse market conditions.”

All investors can trade SSFs through a registered derivatives member. The Saudi Exchange launched the derivatives market in 2020, and seeks to introduce additional derivatives products such as single stock options, a statement said.

Towards the end of last year, the Abu Dhabi Securities Exchange also introduced a derivatives market as part of its initiatives to develop the emirate’s capital markets.

Read: Abu Dhabi Securities Exchange launches derivatives market