The value of shares traded on Middle Eastern venue Nasdaq Dubai reached US$71 million in February 2011, up 50% from US$47.1 million in January but down 46.77% year-on-year from US$133.4 million in February 2010.
The exchange puts the growth down to growing participation from retail investors, whose share of trading in February 2011 reached 5.5% of total traded value, up from 2% of total traded value in August 2010, which was the first full month of trading after Nasdaq Dubai started routing all its equities trades through the trading platform of Dubai Financial Market (DFM) in mid-July.
DFM, which is the exchange subsidiary of government-owned holding company Borse Dubai, purchased exchange operator Nasdaq OMX's 30% stake in Nasdaq Dubai in December 2009 to give it two-thirds ownership of the market, with Borse Dubai's owning the other third. It made numerous operational changes in 2010, including the platform migration, that were intended to increase retail order flow.
The value of retail trades on Nasdaq Dubai rose from US$1.6 million in August 2010 to US$3.9 million in February 2011. The retail share in January 2011 was 13%, with a value of US$6 million.
Seven regional brokers became members of Nasdaq Dubai in 2010 to take advantage of the new trading regime, bringing the total number of members to 35 international and regional brokers. In addition, in January 2011, Bank of America Merrill Lynch joined Nasdaq Dubai as a general clearing member.
“In a challenging period for Middle East capital markets, the increase in retail trading in 2011 from last year indicates that the switch to DFM's platform has succeeded in attracting more retail investors to Nasdaq Dubai's market,” said Jeff Singer, CEO of Nasdaq Dubai.
The FTSE Nasdaq Dubai UAE 20 index, which tracks 20 liquid stocks listed on DFM, the Abu Dhabi Securities Exchange and Nasdaq Dubai, ended February 2011 at 1,508, down 9% from the end of January 2011.